No evidence suggesting slowdown in Indian economy: Finance ministry

Several forecasting agencies also share optimism as they have upwardly revised their growth estimates for India for 2023-24

New Delhi: The Indian economy has carried the momentum from the past year into the current fiscal year and there has been no evidence by far that suggests a slowdown in the current financial year 2023-24, said the Department of Economic Affairs under Ministry of Finance in its monthly review report.

According to the provisional estimates released by the National Statistical Office (NSO) recently, real GDP growth for 2022-23 stood at 7.2 per cent, higher than the 7 per cent as was projected earlier. An upward revision in the 2022-23 GDP numbers is expected going forward.

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For 2023-24, the central government sees growth at about 6.5 per cent.

“A strong final quarter performance pushed the GDP growth for the full year to 7.2 per cent, higher than the 7 per cent estimated in February. This upside to the growth estimate takes the growth momentum deep into the current year,” said the finance ministry report.

Several forecasting agencies also share optimism as they have upwardly revised their growth estimates for India for 2023-24.

“The latest evidence also does not indicate any slowing of activity in the first two months of the current year. India is the fastest-growing major economy, is now no longer only a statistical fact,” it added.

The finance ministry stated that what has been clearly working for India’s economy is the strength of its domestic demand.

“High-frequency indicators paint a healthy picture of the state of the economy. Urban demand conditions remain resilient, with higher growth in auto sales, fuel consumption and UPI transactions. Rural demand is also on its path to recovery, with robust growth in two and three wheelers sales.” Goods and Services tax collection, Purchasing Managers’ Index (PMI) for the manufacturing and services sector continues to expand, it noted.

Further, for the agricultural sector, it said the forecast of a normal monsoon despite the prevalence of El Nino, adequate availability of seeds and fertilisers and sufficient water in key reservoirs augur well for a healthy kharif season.

India has three cropping seasons — summer, kharif, and rabi.

Crops sown during June-July and harvested in October-November are kharif. Crops that are sown during October-November and the produce harvested from January-March depending on maturity is Rabi. Crops produced after rabi but ahead of kharif are summer crops.

Farmers have meanwhile started sowing their Kharif crops. Paddy, moong, bajra, maize, groundnut, soybean, and cotton are some of the major Kharif crops.