The Indian economy is expected to grow by 7.1-7.6%.
In FY23, a growth of 7.1-7.6 percent will be witnessed in Indian economy. India will rule as the world’s fastest-growing economy over the next few years. Regardless of geopolitical issues, inflation, interest rate hikes, or Omicron infections.
In 2021, India had many opportunities to grow, but the Russian invasion in Ukraine and the new COVID-19 wave cleaned up all the optimistic events. These events intensified the pre-existing challenges such as surging inflation and geopolitical realities with no definite end in sight. The succeeding convergence of events like surging commodity prices, supply shortages and currency depreciation quickly worsened the Indian economy’s fundamentals that were trending up a few months back.
The Central Bank of India forecasts 7.2% GDP growth for FY23, which ends in March. The Indian rupee will recover against the US dollar, but not before the beginning of next year. The rupee depreciated by 3 paise to close at a record low of 79.62 (temporary) against the US currency on Wednesday. The desire of global businesses to look for more robust and cost-effective investments during difficult times, among other factors, could work to India’s benefit.
Inflation in India is expected to come close to 5% by March. There is a 20–30% possibility that there could be a global recession in the economy. The aggressive monetary tightening policy followed by inflation may lead to recession, particularly in the US economy. The slowdown in inflation in the past two months is possible because of steps taken by the government. This includes cuts in taxes on oil and gas, restrictions on food exports and global breakdown in commodity prices. The government increased GST rates to offset any inefficiencies in the value chain. Globally, surging inflation has been the main factor as it concerns both demand and supply side concerns.
The report also mentioned that uncertainties in the global business environment will have significant risks.
