India GDP expected to grow 4.6-5% in third quarter of FY23
1 min read 21 Feb 2023, 09:48 AM ISTIndia GDP data: Government to release third quarter GDP growth on February 28
PremiumThe government is expected to release the third quarter GDP data on February 28. Experts and economists estimate that the India's economy grew 4.6%-5% during the October-December 2022 period.
Barclays India expects India’s Q3 FY23 GDP (or Q4 2022) to rise 5.0% YoY, slowing from 6.3% growth in the year ago period. On a sequential (nsa) basis, however, Q3 GDP is likely to increase faster than the previous quarter.
“Our 5.0% growth Q4 (Q3 FY23) forecast implies CY22 growth of 6.9%, which creates modest upside risks to our FY22-23 growth forecast of 7.0%, as high-frequency indicators are looking pretty strong for Q1 2023 (Q4 FY23)," said Rahul Bajoria, MD & Head of EM Asia (ex-China) Economics, Barclays.
Meanwhile, SBI Research estimates India’s GDP growth for Q3 FY23 at 4.6%.
RBI estimated Q3FY23 Real GDP growth would be at 4.4% and full year FY23 estimated by NSO at 7.0%. For 2023-24, RBI is projecting GDP growth at 6.4% with Q1 at 7.8%; Q2 at 6.2%; Q3 at 6.0%; and Q4 at 5.8%.
“In India, domestic consumption and investment stand to benefit from stronger prospects for agricultural and allied activities, strengthening business and consumer confidence, and strong credit growth. Supply responses and cost conditions are poised to improve even though inflation witnessed a rebound in January. The Union Budget 2023-24’s emphasis on capital expenditure is expected to crowd-in private investment, strengthen job creation and demand, and raise India’s potential growth," said Soumya Kanti Ghosh, Group Chief Economic Adviser, State Bank of India.
Compared to the pre-Covid number, the GDP is likely to have grown 11.6 per cent in Q3 from 7.6 per cent in the previous quarter, boosted by continued recovery in the services sector, said Aditi Nayar, chief economist and head of research at Icra Ratings, PTI reported.
“GDP is likely to show resilience, in line with robust high frequency indicators through the last few months. Services should continue to lead the recovery in activity, though the manufacturing sector is likely to be a drag, along with goods exports," said Bajoria of Barclays India.
For FY23-24, Barclays expects a soft landing for the economy as tighter monetary conditions and still-elevated inflation take a toll. It sees GDP growth rate moderating to 6% in FY24 and forecasts steady GDP growth of 6.5% for FY25.
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