India forecasts economic growth of 7.3% for the fiscal year ending March – January 5, 2024

NEW DELHI (Reuters) – India's economy is expected to grow 7.3% in the current fiscal year ending in March, the fastest rate among the world's major economies, helped by government spending and a revival in the manufacturing sector, the National said Statistics Office on Friday.

The first advance estimates of annual gross domestic product come after the Reserve Bank of India (RBI) raised its growth forecast to 7% last month from an earlier estimate of 6.5%.

“These are early forecasts for 2023/24,” the National Statistics Office (NSO) said in a statement, noting that improved data coverage, actual tax revenues and spending on government subsidies would impact later revisions.

India's economy grew by 7.2% in 2022-23 and 8.7% in 2021-22.

Manufacturing, which accounts for about 17% of GDP, is expected to grow 6.5% year-on-year in 2023/24, compared to 1.3% last year, while construction output is expected to grow 10.7% year-on-year, compared to 10 % increased. last year, the data showed.

However, growth in agricultural production, which contributed about 15% to GDP, slowed to 1.8% in the current fiscal from 4% last year, impacting rural wages.

India posted faster-than-expected economic growth of 7.6% year-on-year in the September quarter, after growing 7.8% in the previous quarter, prompting many private economists to revise their full-year estimates upward.

Among other things, S&P Global Ratings expects India to remain the fastest-growing major economy over the next three years and become the world's third-largest economy by 2030, overtaking Japan and Germany.

Finance Minister Nirmala Sitharaman will present an interim annual budget on February 1 and is expected to increase spending on infrastructure, supported by rising tax revenues, while aiming to reduce the fiscal deficit from 5.9% of GDP in the current fiscal.

(Reporting by Manoj Kumar; Editing by William Maclean)

By Manoj Kumar