May 24, 2024

Whereas presenting the 2022-23 Financial Survey on January 31, 2023, Chief Financial Adviser V Anantha Nageswaran had predicted the Indian financial system would develop by 6.5 p.c in 2023-24.

The finance ministry expects the Indian financial system’s GDP development charge in 2023-24 to “comfortably” exceed its forecast of 6.5 p.c following the blockbuster information for July-September.

“Dangers to development and stability outlook primarily emanate from exterior the nation. Nonetheless, the Indian financial system is anticipated to comfortably obtain a development charge upwards of 6.5 p.c in 2023-24,” officers from the the ministry’s Division of Financial Affairs stated within the half-yearly financial evaluate report, launched on December 29.

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Additionally Learn: RBI mannequin pegs India’s FY25 GDP development at 6.0% vs official view of 6.5%
Knowledge launched on November 30 by the statistics ministry confirmed India’s GDP development charge got here in at 7.6 p.c in July-September, considerably increased than economists’ expectations of 6.8 p.c. Days after the discharge of the info, the Reserve Financial institution of India (RBI) raised its development forecast for 2023-24 by 50 foundation factors to 7.0 p.c.

One foundation level is a hundredth of a proportion level.

Whereas the finance ministry was anticipated to observe swimsuit – Chief Financial Adviser V Anantha Nageswaran had, on November 30, hinted at an upward revision within the upcoming financial evaluate report – it has solely stated development will simply exceed its forecast with out offering a brand new quantity.

In its half-year financial evaluate report, the finance ministry additionally stated that high-frequency information for October and November instructed financial exercise within the third quarter of 2023-24 has been strong and is “prone to proceed in This fall as effectively”.

“Whereas city consumption continues to be the important thing driver of consumption development, rural demand has additionally proven a robust pick-up. These tendencies sign continued momentum within the coming months,” the finance ministry’s report stated.

Supply: Ministry of Finance

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On the identical time, the ministry’s report warned that geopolitical developments proceed to influence India’s exterior sector, with India’s items exports shrinking within the first half of the present monetary yr in comparison with final yr amid an financial slowdown in India’s key commerce companions.

Additionally Learn: India’s present account deficit narrows to $8.3 billion in July-September

On costs, the finance ministry admitted that whereas India’s “comparatively excessive meals inflation…is a matter of concern, you will need to point out that the current charge of enhance in costs is a worldwide phenomenon”.

“Whereas India recorded 6.6 p.c meals inflation in October, the UK remains to be grappling with 10.1 p.c, Japan at 9.8 p.c, and South Africa at 9 p.c meals inflation,” the ministry stated.

In accordance with newest information launched on December 12, India’s meals inflation rose to eight.7 p.c in November.