India’s economy is anticipated to display significantly increased sequential and compared to the previous growth in the most recent January-March quarter (Q4 FY23), propelled by the manufacturing and services sectors and a positive increase in private investment.
The National Statistical Office will present the official print for Q4 FY23 and the entire FY23 year later on Wednesday. Analysts anticipate that Q4 GDP growth will be at least 5%, and there is general agreement that FY23 GDP growth will be in the neighbourhood of the official advance forecasts of 7%, making India the fastest-growing major economy.
Stronger prospects for agriculture and related businesses, growing corporate and consumer confidence, and rapid credit development in India all favour domestic consumption and investment. The economic recovery is still on track, with Q4FY23 GDP growth predicted to be 5.1% year over year compared to Q3’s 4.4 percent.
With an increase in trade, hotel and transport spending as well as government spending, the services sector is most likely to take the lead in the recovery.
Rural consumption is beginning to show indications of recovery as real rural wage growth turns positive, even while urban areas continue to support the consumption rebound. The domestic demand for services outpaced that for products in the fourth quarter of FY23, and service exports were surprisingly strong despite a decline in exports of goods.
Margin relief came from lower commodity prices in some industries, but trends in investment activity and government spending were uneven. Unseasonal rains, however, are anticipated to have had an impact on some crops’ rabi output, which will weigh on the expansion of the GVA for agriculture.