India’s economy has delivered a stellar performance in the third quarter of the current fiscal year. GDP growth reaches 8.4%, the highest in the past six quarters. This makes India the fastest-growing economy in the world. What are the factors behind this impressive achievement in the GDP of India?
Let’s find out.
Key Highlights: GDP Growth Rate of India- Q3
India’s Ministry of Statistics and Programme Implementation revealed that India’s gross domestic product (GDP) expanded by 8.4 percent in the December quarter, exceeding all expectations.
· India’s GDP grows by 8.4% in Q3, exceeding forecasts.
· National Statistical Office revises India’s GDP growth for 2022-23 to 7%.
· Q2 FY24 GDP growth revised up to 8.1% from 7.6%.
· India maintains the fastest-growing large economy status.
· The manufacturing sector leads growth with double-digit expansion.
India’s Economic Growth: Revisions and Expectations
Previously estimated at 7.6 percent, India’s GDP growth rate for the second quarter of FY24 has been revised upward to 8.1 percent.
Additionally, the National Statistical Office revised the GDP growth for 2022-23 to 7 percent, down from the earlier estimate of 7.2 percent.
Surprising Numbers
Contrary to predictions of a slowdown to 6.5 per cent, a survey of economists anticipated Q3 GDP growth, the actual GDP of India surpassed expectations, reaching 8.4 per cent. The first and second quarter estimates were also adjusted upward, reflecting growth rates of 8.2 per cent and 8.1 per cent, respectively.
Outlook and Projections
Despite initial estimates of 7.3 percent, the statistics ministry now forecasts a higher full-year GDP growth of 7.6 percent for 2023-24.
Prime Minister Narendra Modi expressed optimism about India’s economic growth and strength, emphasizing efforts to sustain rapid growth.
Analysis and Commentary
Experts analyze the divergent trend between GVA and GDP growth rates, cautioning against over-reliance on headline GDP figures.
Aditi Nayar, chief economist at ICRA Ltd., highlights the importance of monitoring investment trends. This growth amidst fluctuations in government expenditure and sectoral growth.
India’s Global Standing
India’s unexpectedly high quarterly growth solidifies its position as the world’s fastest-growing large economy, with double-digit growth in manufacturing driving the surge.
Sectoral Insights
The manufacturing sector led growth with double-digit expansion, while construction followed closely with a growth rate of 9.5 percent. Agriculture, however, experienced a contraction of 0.8 percent.
Base Effects and Revisions
Revisions in GDP figures for both FY23 and FY24, alongside fluctuations in sectoral growth, are attributed to base effects.
Despite challenges, the upward trend in GDP indicates a promising outlook for India’s economic growth.
Conclusion
The robust GDP growth rate of India at 8.4% in Q3 and the upward revision of FY24 growth to 7.6% indicates a promising future for the country. This surge in economic expansion exceeds expectations, showcasing the strength and potential of the Indian economy.
Source– moneycontrol.com
______________________________________________________________________________________
Disclaimer: Investments in the securities market are subject to market risks; read all the related documents carefully before investing.