Indian economy estimated to grow at 7 pc in 2022-23, as against 8.7 pc expansion in FY22: Govt data

The Indian economy is likely to grow at a rate of 7 per cent in the current fiscal, against the 8.7 per cent growth in 2021-22, the National Statistical Office (NSO) said on Friday.

The NSO, while releasing the first advance estimates of National Income for 2022-23, said that the "Real GDP or GDP at Constant (2011-12) Prices in the year 2022-23 is estimated at Rs 157.60 lakh crore, as against the Provisional Estimate of GDP for the year 2021-22 of Rs 147.36 lakh crore, released on May 31, 2022. The growth in real GDP during 2022-23 is estimated at 7 per cent as compared to 8.7 per cent in 2021-22".

In December 2022, the RBI had scaled down the GDP growth forecast to 6.8 per cent for the current fiscal from the earlier estimate of 7 per cent, mainly due to prevailing geopolitical tensions and global tightening.

In a significant projection, the output of the manufacturing sector is estimated to slide down to 1.6 per cent as against a growth of 9.9 per cent in 2021-22, the first advance estimate noted further.

Private final consumption expenditure, a yardstick for demand, is projected to rise 7.7 per cent in 2022-23 from a year ago.

Gross fixed capital formation, a measure of investment, is estimated to rise around 11.5 per cent in the current fiscal, the data said.

Electricity sector growth in the current fiscal is estimated at 9 per cent, compared to 7.5 per cent in the previous fiscal.

"We believe that buoyant albeit mixed domestic consumption should help to stave off some of the pain arising from weak exports during this period. Contrary to our expectations, the NSO expects private final consumption expenditure to contract by 0.2% YoY in H2 FY2023. Further, it expects exports to rise by 11.9% in H2 FY2023, which we believe is unlikely, given the flagging external demand,"said Aditi Nayar, chief economist, ICRA. 

Trade and hotels estimated growth is 13.7 per cent, up from last fiscal`s 11.1 per cent. For finance and real estate, the estimated growth is 6.4 per cent from last fiscal`s 4.2 per cent.

Estimated growth for the agriculture sector is pegged at 3.5 per cent compared to the previous fiscal`s 3 per cent.

Mining growth estimation is at 2.4 per cent, up from last year`s 11.5 per cent.