India’s Finance Minister, Nirmala Sitharaman, has declared India a bright spot in the global economy, as the country’s GDP surpasses $3.75tn in 2023, up from $2tn in 2014. The country’s GDP growth rate stood at 6.1% for the Q4 of FY22-23, exceeding expectations, and the growth rate for the entire fiscal year was 7.2%. India is now the world’s fifth-largest economy, positioned just above the UK, France, Canada, Russia and Australia. Last year, it surpassed the UK to become the fifth-largest economy, and it is still behind the US, China, Japan and Germany.
India’s Chief Economic Advisor, Dr V Anantha Nageswaran, applauded the record growth. He said that private consumption had recovered swiftly to pre-pandemic levels, particularly urban consumption. He also added that GDP growth could be revised upwards as the pandemic abated. Moody’s rating agency estimated that India’s economy could grow by between 6% and 6.3% for the April-June quarter, with two notable risks being weaker-than-expected government revenues and a high level of general government debt.
The rating agency also remarked that India has high growth potential, with credit strengths that include a stable domestic financing base for governmental debt and a sound external position. Moody’s growth estimate was lower than the Reserve Bank of India’s (RBI) projection for the first quarter of fiscal year 2023-24. RBI expected growth of 8% when it released its second monetary policy review.
