Mumbai: Leading rating agencies and economists claimed that the Indian economy is expected to have grown 7.8-8.5% in the April-June quarter. Barclays has estimated Q1 GDP growth at 7.8%t, while SBI Research and ICRA have estimated Q1 growth at 8.3% and 8.5%, respectively.
The growth estimates are higher than the projection of the Reserve Bank of India (RBI). The apex bank has estimated Q1 FY24 real Gross Domestic Product (GDP) growth at 8.0% and full year FY24 growth at 6.5%.
‘We peg GDP growth in Q1 FY2024 at 8.5%, exceeding the Monetary Policy Committee’s (MPC’s) forecast of 8.0%. However, we are circumspect that erratic rainfall, narrowing differentials with year-ago commodity prices, and possible slowdown in momentum of Government capex as we approach the Parliamentary elections, could dampen GDP growth in H2 FY2024 below the MPC’s forecasts. Overall, we maintain our FY2024 GDP growth estimate at 6.0%, lower than the MPC’s projection of 6.5% for the fiscal,’ said Aditi Nayar, Chief Economist, Head-Research & Outreach, ICRA.
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‘More importantly, there has been a surge in capital expenditure in Q1, with Central government spending 27.8% of budgeted, while states at 12.7% of budgeted. States like Andhra Pradesh, Telangana, Madhya Pradesh where are elections are due have registered capital expenditure growth up to 41%,” Soumya Kanti Ghosh, Group Chief Economic Adviser, SBI said in Ecowrap report.
According to the report, the growth in incremental deposits has almost doubled at Rs 11.3 lakh crore, compared to Rs 5.0 lakh crore last year (Rs 2.73 lakh crore received through Rs 2000 banknotes and Rs 1.5 lakh crore from HDFC merger).
India’s GDP growth had clocked a higher-than-expected growth rate of 6.1% in January-March, in turn pushing up the growth estimate for full year 2022-23 to 7.2%. GDP data for April-June is scheduled to be released on August 31.
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