Slow consumption spoils GDP party

Household consumption in FY24 is likely to grow at the slowest pace in last two decade

- DIPAK MONDAL

THE first advance estimate of 2023-24 GDP has sprung a positive surprise, with the economy predicted to grow at 7.3% during the year. However, slow private consumption growth remains a cause of concern.

Private consumption in FY24 is likely to grow at 4.4%, lowest in the past 20 years (barring the Covid year of 2020-21). This, despite the fact the GDP growth has been better than expected, raising fear that the growth is not reaching all sections of the society.

Data belies govt claims

The first advance estimates of FY24 GDP numbers by the National Statistical Office (NSO) belies the claims made by the RBI and the finance ministry. In its November monthly economic review, the ministry had claimed while urban consumption continued to grow, rural demand has shown a strong pick-up. "These trends signal continued momentum in coming months," added the report.