WILL INDIA'S ECONOMY slow in 2023? The consensus: 2022 was an outlier with GDP growth nudging seven per cent, the highest among major economies. Even the normally conservative World Bank upgraded its forecast for Indian economic growth in 2022 from 6.5 per cent to 6.9 per cent. But according to most projections, Indian GDP growth in 2023 will sag to six per cent or lower. There are three reasons advanced for this pessimistic outlook.
One, the Russia-Ukraine war will grind on relentlessly, exacerbating trade disruptions. India's merchandise exports, which account for around 12 per cent of GDP, could be severely affected.
Two, recession in the West will trigger cuts in information technology budgets among large US and European firms, causing a slowdown in India's bellwether infotech sector.
Three, the fall in rural demand across domestic sectors, especially FMCG, allied with inflation will dampen consumption and lower overall economic growth.
Some of these concerns are valid though overstated. As Sanjeev Sanyal, a member of the Prime Minister's Economic Advisory Council (PMEAC), notes, India's economy can plausibly grow at nine per cent a year. He said at a recent G20 conclave: "We can sustain a growth rate of 9 per cent for many years."
The resilience of the Indian economy was demonstrated throughout 2022 by strong growth despite a spike in the price of crude oil. In February 2021, a year before the Russian invasion of Ukraine, oil was priced at $62 a barrel. On 6 March 2022, with the Russia-Ukraine war intensifying, crude peaked at $129 a barrel before moderating to $76 a barrel in December 2022 as the Chinese economy slowed. India's annual crude oil import bill, assuming an average price of $80 a barrel, is over $120 billion. While Indian officials have done well to negotiate deep discounts with Russia, the relatively high cost of crude has widened the trade deficit.
Bu hikaye Businessworld India dergisinin December 31, 2022 sayısından alınmıştır.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 8,500+ magazines and newspapers.
Already a subscriber ? Giriş Yap
Bu hikaye Businessworld India dergisinin December 31, 2022 sayısından alınmıştır.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 8,500+ magazines and newspapers.
Already a subscriber? Giriş Yap
Powerful, Peculiar Perquisites
MOST COMPANIES recognise that people are key to their success. Competition is all about the war for talent. Higher compensations can, in many cases, attract that brilliant leader or the tech genius, but a competitor may well offer even more. This race is financially draining and not really a great strategy.
Shaping The Future Of India's Infrastructure
RUPEN PATEL on the achievements of the engineering and construction major including the iconic projects rendered by it, nation building, focus on sustainable practices and much more
WHY DON'T WE SUE BRITAIN?
I WAS WORKING ON my next column for BW – on one of my favourite themes like ‘Sustainability’, ‘Inclusivity’, ‘India Shining’ etc.
LIFE AND TIMES OF A MEDIA TITAN
DD Purkayastha's autobiography captures his 42-year tryst with the ABP Group, delving into various aspects of his professional and personal experiences, as well as insights into the factors that have shaped his character and career trajectory
THE SONET STRIKES BACK
The sub-4-metre SUV segment in India has been a battlefield for automakers, each vying for supremacy with their unique propositions. With the launch of 2024 Kia Sonet, the South Korean automaker is sharpening its edges in this competitive market
SLEEK, SUBTLE, COMPACT AND EASY TO CARRY
The HP Omen Transcend 14 targets a niche market that is growing day by day. Statistically, never in history, was there a better time to launch a gaming laptop, says Deep Majumdar
Geopolitical Resilience for Indian Companies
It's in crisis that inventiveness is born, as well as discoveries made and great strategies arise. He who overcomes crisis, overcomes himself, without getting overcome. - Albert Einstein
The Sourav Ganguly Era
Lessons in Leadership from Indian Cricket - 2
Leadership Challenges Were Not This Long, Before
LEADING IN TODAY’S dynamic environment presents unprecedented challenges. The list of challenges is never-ending. They include navigating complex decisions, staying resilient, inspiring teams, staying innovative, and continually adapting to the constantly changing ecosystem.
The Supreme Court Emerges as a Net Zero Polestar
'Dharma exists for the welfare of all beings. Hence, that by which the welfare of all living beings is sustained, that for sure is dharma,' - Mahabharata (Shanti Parva 109.10)