GDP forecast of 6.5% for current fiscal looks possible; PM Modi hails 2022-23 growth figures

The 2022-23 GDP growth figures underscore the resilience of the Indian economy amid global challenges

June 1, 2023

India’s GDP grows by 7.2% in FY23: Govt data

With the growth rate for 2022-23 estimated to be 7.2 percent, the government said that the risks to the GDP forecast of 6.5 percent for the current fiscal (2023-24) are now evenly balanced than a few months ago.

With economic growth estimated at 7.2 percent for 2022-23, more than the advanced estimates of 7 percent, Prime Minister Narendra Modi expressed satisfaction with the GDP growth figures.

PM Modi tweeted, “The 2022-23 GDP growth figures underscore the resilience of the Indian economy amid global challenges. This robust performance along with overall optimism and compelling macro-economic indicators exemplify the promising trajectory of our economy and the tenacity of our people.”

The 2022-23 GDP growth figures underscore the resilience of the Indian economy amidst global challenges. This robust performance along with overall optimism and compelling macro-economic indicators, exemplify the promising trajectory of our economy and the tenacity of our people.

— Narendra Modi (@narendramodi) May 31, 2023

After the GDP data for the fourth quarter of 2022-23 and for the entire fiscal was released, Chief Economic Adviser (CEA) V Anantha Nageswaran said, “Though the GDP growth of 7.2 percent for 2022-23 is higher than the advanced estimates, it is much lower than the 9.1 percent growth seen in 2021-22.

“We are now prepared to say that risks to our GDP growth forecast of 6.5 percent for 2023-24 are now more evenly balanced than a few months ago when downside risks to the forecast were greater.”

According to official data, India posted a GDP growth of 6.1 percent in the January-March period of 2022-23 as against 4.4 percent in the preceding quarter. For the entire 2022-23, the growth rate was estimated at 7.2 percent, which is higher than the advanced estimates of 7 percent, but lower compared to the 9.1 percent recorded in 2021-22.

“I think I can stick my neck out and say that when the revised numbers for FY23 are released next year, there might be an upward revision to the 7.2 percent GDP growth figure,” Nageswaran added.

“India is on track to achieve the fiscal deficit target of 5.9 percent of GDP in 2023-24,” he said, adding that there are chances that retail inflation will return to RBI’s medium-term target of 4 percent in 2023-24.

Retail inflation was at an 18-month low of 4.7 percent in April 2023.

“We are seeing indications of the strong recovery in rural demand,” the CEA said. The agricultural sector saw a growth of 5.5 percent in the fourth quarter of 2022-23.

Capacity utilization has already crossed 75 percent in several sectors, Nageswaran added.

He also pointed out that total employment in the hotel industry was 40 million before the pandemic. This fell to 29 million during the pandemic but has now increased to 45 million.

Nageswaran told reporters that private consumption as a percentage of the GDP was at a 16-year high in 2022-23.

[With Inputs from IANS]

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