Researchers at the National Institute of Public Finance and Policy (NIPFP) have projected that the Indian economy will grow at 6% in fiscal year 2023-24 (FY24). This is higher than the 8.7% growth recorded in FY22, but lower than the 7.2% growth projected by the government.
The NIPFP researchers say that the growth in FY24 will be driven by a number of factors, including:
- A rebound in private consumption, as the pandemic subsides and people feel more confident about spending.
- A pick-up in investment, as businesses start to invest in new projects.
- A favorable export outlook, as global demand for Indian goods and services continues to grow.
However, the researchers also say that there are some risks to the growth outlook, including:
- The ongoing war in Ukraine, which could disrupt global supply chains and lead to higher inflation.
- A tightening of monetary policy by the Reserve Bank of India (RBI), which could slow down credit growth.
- A slowdown in the Chinese economy, which could impact India's exports.
Overall, the NIPFP researchers say that the Indian economy is on track to recover from the pandemic and grow at a healthy pace in FY24. However, they caution that there are some risks to the outlook, which could derail growth.
Here are some additional details about the NIPFP's projections:
- The researchers say that the growth in FY24 will be broad-based, with all sectors of the economy contributing to the growth.
- They say that the growth will be driven by both domestic and external demand.
- They say that the inflation rate will remain elevated in FY24, but it will come down from the levels seen in FY22.
- They say that the current account deficit will widen in FY24, but it will remain manageable.
The NIPFP's projections are in line with the projections of other economic think tanks, such as the World Bank and the International Monetary Fund. These projections suggest that the Indian economy is on track to recover from the pandemic and grow at a healthy pace in the coming years.
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