Delhi’s Surprise Slowdown: What’s Next for the Capital’s Economy?

Delhi’s economy has hit a speed bump, recording a growth rate of just 6.2% for the financial year 2024-25-the slowest pace since the post-pandemic rebound began in 2021-22. This marks a significant deceleration from the robust 9.18% growth seen in 2022-23 and the 9.14% expansion in 2021-22, as highlighted in the latest Economic Survey of Delhi.

 

The slowdown follows two years of fast recovery, during which the economy of Delhi beat the country's average, driven by impressive performances in the services sector and a rebound in consumption and investment. But latest numbers indicate the momentum has flagged, with growth in the city now falling below earlier highs and dipping towards the national average.

 

Despite the slower growth, Delhi continues to boast the highest per capita income among Indian states, with a 7.54% rise in 2022-23. Yet, experts point to challenges such as supply chain disruptions, rising costs, and a shifting business landscape as factors behind the recent dip. The services sector, which forms the backbone of Delhi’s economy, remains resilient but is showing signs of strain amid broader economic headwinds.

 

Policymakers are presently targeting reviving growth through specified investments and reforms, with a vision to position Delhi as an emerging economic powerhouse once again.

 

Sources: Economic Survey of Delhi, ThePrint, Economic Times