Page 4 - Policy Economic Report_Mar'25

POLICY AND ECONOMIC REPORT
OIL & GAS MARKET

Executive Summary

According to OECD Economic Outlook published in March 2025, global output growth remained resilient
in 2024, with robust expansions in the United States and several large emerging-market economies,
including China.

However, with uncertain global circumstances, softening of global growth prospects have been
witnessed in some countries. Business and consumer sentiment have weakened in some countries, and
indicators of economic policy uncertainty have risen markedly around the world.

Global GDP growth is projected to moderate from 3.2% in 2024, to 3.1% in 2025 and 3.0% in 2026, with
higher trade barriers in several G20 economies and increased geopolitical and policy uncertainty
weighing on investment and household spending.

Annual GDP growth in the United States is projected to slow from its strong recent pace, to be 2.2% in
2025 and 1.6% in 2026. Euro area GDP growth is projected to be 1.0% in 2025 and 1.2% in 2026, as
heightened uncertainty keeps growth subdued. Growth in China is projected to slow from 4.8% this year
to 4.4% in 2026.

In case of India, according to NSO’s Second Advance Estimates, India’s GDP is projected to grow by 6.5%
in FY 2024-25. Quarter 3 GDP growth was 6.2%, rebounding from 5.6% in Q2 due to higher private
consumption and government spending. Real GDP has been estimated to grow by 6.5% in FY 2024-25.
Nominal GDP is expected to witness a growth rate of 9.9% in FY 2024-25. Both the growth rates are
revised upward from their respective First Advance Estimates.

‘Construction’ sector is estimated to observe a growth rate of 8.6%, followed by ‘Financial, Real Estate &
Professional Services’ sector (7.2%) and ‘Trade, Hotels, Transport, Communication & Services related to
Broadcasting’ sector (6.4%) during 2024-25.

Inflation- CPI Inflation- India's CPI inflation fell to a 7-month low of 3.6% in February 2025 due to a
substantial decline in food and beverage prices.

Food Inflation- Year-on-year inflation rate based on All India Consumer Food Price Index (CFPI) for the
month of February, 2025 over February, 2024 is 3.75% (Provisional).

Fuel and light- Deflation is continued for 18 months at -1.33%. It is combined inflation rate for both rural
and urban sector.

CPI inflation is expected to decline to 3.9% in Q4 FY25 and average 4.7% for FY25. FY26 inflation is
projected in the range of 4.0-4.2%, while core inflation may range between 4.2-4.4%. The Reserve Bank
of India (RBI) may implement successive rate cuts in April and August 2025, with an overall expected
cumulative rate cut of at least 75 basis points. The cycle of rate cuts may continue from October 2025,
following an intervening gap in August 2025.

The Quick Estimates of Index of Industrial Production (IIP) are released on 12th of every with a six weeks
lag and compiled with data received from source agencies, which in turn receive the data from the

March 2025 Page | 3