GDP grows by 6.1% in FY23

This growth has surpassed all growth predictions for the quarter, including the Reserve Bank of India’s (RBI) projection of 6.1%, State Bank of India (SBI) Research’s 5.5%, and a Reuters poll of 5%

June 1, 2023

In the March quarter, India's manufacturing sector experienced a 4.5% year-on-year growth, compared to a 1.1% contraction in the previous quarter

High-frequency indicators for the March quarter indicated an increase in urban incomes, which boosted sales of luxury cars, smartphones, and air travel

Throughout FY23, the Indian economy demonstrated growth rates of 13.1%, 6.2%, and 4.5% in Q1, Q2, and Q3, respectively, on an annual basis

The RBI anticipated growth for FY23 to exceed 7%

India’s Gross Domestic Product (GDP) recorded a growth of 6.1% in the last quarter of the previous fiscal year surpassing all previous predictions, according to data released by the Ministry of Statistics and Program Implementation (MOSPI). 

The Reserve Bank of India (RBI) had projected real GDP growth of 5.1% for Q4FY23, while SBI Research anticipated a growth rate of 5.5%. A Reuters poll had estimated a 5% growth for the January-March quarter on a year-on-year basis, attributing it to steady urban demand and government expenditure.

Throughout FY23, the Indian economy demonstrated growth rates of 13.1%, 6.2%, and 4.5% in Q1, Q2, and Q3, respectively, on an annual basis.

In the March quarter, India’s manufacturing sector experienced a 4.5% year-on-year growth, compared to a 1.1% contraction in the previous quarter. Similarly, farm output grew by 5.5 %, compared to a 3.7% growth in the same period.

Based on provisional estimates of Gross Value Added (GVA), the manufacturing sector grew by 1.3% in FY23, down from 11.1% growth in FY22. Agriculture, forestry, and fishing recorded a 4% growth in FY23, up from 3.5% in the previous fiscal year.

The robust performance of consumer services such as travel and retail, along with reducing food prices and global oil price declines, were key factors contributing to the optimistic median forecast of economists in the Reuters poll. Trade, hotels, transport, communication, and services related to broadcasting recorded a growth of 14% in FY23, compared to 13.8% in FY22.

High-frequency indicators for the March quarter indicated an increase in urban incomes, which boosted sales of luxury cars, smartphones, and air travel. Lower food, crude oil, and raw material prices further stimulated demand for services such as air travel and manufactured items like cars and mobile phones.

Experts mentioned that owing to the strong momentum observed in the last two quarters of the previous fiscal year, the RBI anticipated growth for FY23 to exceed 7%. In FY22, the Indian economy grew at 9.1%.

Source: Economic Times

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