New Delhi, July 21: Industry body FICCI has downgraded India’s annual Gross Domestic Product (GDP) growth forecast for the financial year 2022-23 at 7.0 per cent — with a minimum and maximum growth estimate of 6.5 per cent and 7.3 per cent, respectively.
The median growth forecast for agriculture and allied activities has been put at 3.0 per cent for 2022-23. On the other hand, the industry and services sectors are anticipated to grow by 6.2 per cent and 7.8 per cent, respectively, during the fiscal year.
In its latest round of FICCI’s Economic Outlook Survey (July 2022), the growth projection has been revised on account of geopolitical uncertainty and its repercussions for the Indian economy.
In April, it had estimated India’s growth at 7.4 per cent for 2022-23.
The present round of surveys was conducted in the month of June 2022 and drew responses from leading economists representing the industry, banking, and financial services sector, the industry body said in a statement.
“Indian economy is not immune to global volatility, as is evident from the deepening inflationary pressures and increasing uncertainty in financial markets. The participants pointed out that these factors are exerting pressure on India’s economic prospects and are likely to delay the recovery,” it added.
Major risks to India’s economic recovery include rising commodity prices, supply-side disruptions, and bleak global growth prospects with the conflict prolonging in Europe. A slowdown in the Chinese economy is also expected to have an impact on India’s growth. Increased input costs are impairing discretionary spending as these get passed on to the final consumer through higher selling prices.
The industry body pegged India’s retail inflation rate at 6.7 per cent for 2022-23, with a minimum and maximum range of 5.4 per cent and 7.0 per cent, respectively, which is in line with RBI’s projections. Inflation levels are expected to slow down starting September 2022 and fall back into the 4 per cent range only by June 2023.
