India remains the fastest growing economy in world with GDP at 6.1% in Q4 FY23


Representational image. PTI

India has outdone its own GDP projections in Quarter 4 of FY23 to reach a whopping 6.1 per cent as compared to the growth witnessed in Q3 which stood at 4.4 per cent.

According to data released by the National Statistical Office, India’s economy will see an overall growth of 7.2 per cent in FY23.

The country has witnessed steady growth among some of the fastest-growing economies including China and the US.

According to the data released on Wednesday, India saw a growth of 6.1 per cent between January and March (Q4) while Indonesia, the second to follow, grew 4.8 per cent. Countries like China, Mexico, US and Japan grew by 4.5 per cent, 3.8 per cent, 1.6 per cent and 1.3 per cent respectively in the same period.

How is India retaining the tag of fastest growing economy?

India’s outstanding performance has been attributed to the steady growth in the consumption and services sector.

The figures are almost in tune with predictions made by the State Bank of India (SBI) which had called in at 7.1 per cent and the World Bank which predicted a seven per cent growth for India.

Private consumption, which accounts for nearly 60 per cent of the economy, grew 2.8 per cent on-year compared to 2.1 per cent in the previous quarter, while capital formation, an indicator of investment, rose 8.9 per cent on-year from a downward revised 8% in the previous quarter.

Federal government spending, constituting about 10 per cent of the GDP, rose 2.3 per cent year-on-year in the March quarter, compared to a revised 0.6 per cent contraction in the previous quarter.

Meanwhile, India has been able to brush aside recessions and slowdowns triggered by worldwide inflation as well as the turmoil caused by the Russia-Ukraine war.

Hours before the GDP figure was officially released, RBI Governor Shaktikanta Das said, “In almost all the high-frequency indicators which we monitored at the Reserve Bank of India, the momentum was maintained in the fourth quarter. So therefore, we should not be surprised if the (overall annual) growth is slightly more than 7 per cent.”

IMF confirms India’s growth

The International Monetary Fund has highlighted India’s role in the world economy and said that the country continues to perform well while remaining one of the fastest growing in the world.

In April, Anne-Marie Gulde-Wolf, Deputy Director for Asia and Pacific Department, IMF, told PTI, “The Indian economy continues to perform well and remains the fastest growing Asian economy and one of the fastest growing in the world.”

With consumption slowing, she said, IMF sees the investment as the main driver of growth as evidenced by double-digit credit growth, strong PMIs and an ambitious budgeted government spending programme.

With inputs from agencies

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