The Indian government has projected a robust GDP growth of 7.3% for the fiscal year 2023-24, surpassing earlier estimates and indicating a stronger economic rebound. This forecast is notably higher than the Reserve Bank of India’s prediction of 7% growth for the same period. While the real GDP growth for FY23 was initially estimated at 7.2%, a revised figure is expected on February 29, 2024. The government’s optimistic outlook is primarily fueled by investment growth, with gross fixed capital formation projected to rise by 10.3%. However, private consumption lags behind the overall GDP growth, expected to expand at a rate of 4.4%.
Contrary to earlier estimates ranging from 6.5% to 7%, the government’s ambitious growth projection underscores the significance of investment in driving economic recovery. On the supply side, agriculture growth has moderated to 1.8% in FY24, down from 4% in FY23. Meanwhile, the industrial and manufacturing sectors are anticipated to grow at 7.9% and 6.5%, respectively. Construction has emerged as a pivotal growth driver, with an estimated growth rate of 10.7% in the current fiscal year. The government’s final consumption expenditure is also expected to contribute to growth, anticipated to grow at 4.1%. The actual performance and economic dynamics will be closely monitored following the release of revised estimates in February 2024.
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