India needs to address high interest rate and falling exports to revive GDP

The 2022-23 fiscal has just ended. One must wait for about two months to aspects of the performance of the economy. 

- Kishore Kumar Biswas

Some organisations will analyse the economic performance of FY23 based on their own high speed data sources. But before having NSS information on FY 23 some observations may be meaningful. The foremost thing has been the falling rate of growth of the GDP. In the Q1 of FY23 there was a 13.5% growth. This is apparently a high figure but one must consider it was on the very low base of the Q1 of FY 22, a period after the Covid 19 pandemic. The growth rate stood at 6.3% in Q2 of FY22. In the third quarter it further fell to 4.4%. in the last quarter that is in Q4 the growth rate may fall further, according to the prediction of RBI and some other organisations. A few weeks ago, former Chief Economic Advisor of India and former RBI governor Raghuram Rajan pointed out the alarmingly falling growth rate in an interview with the PTI. But many government persons did not accept his observation and expressed their confidence in the strong fundamentals of the economy. They believed that this was a temporary phenomenon due to the impact of the weak performance of the global economies.

Later, former finance minister, P Chidambaram said that the Indian economy was growing but it had been losing its steam. So, one has to assess the economic performance of FY 23 very objectively and look for the factors affecting the growth of the economy.

High interest rates responsible for lower consumption and investment