Indian Budget 2023-24 series: Economy
By 2027, India will have the third-largest economy in the world thanks to changes in policies that will encourage investment and take advantage of demographic trends and public digital infrastructure, according to projections by Morgan Stanley. India’s Finance minister Ms. Nirmala Sitharaman presented the union budget 2023-24 on Feb 1, 2023. Here are the highlights for the development of the overall economy:
- Fifth largest economy in the world, expected to grow at 7%
- Fiscal deficit target limited to 5.9% of GDP
India will continue to grow at a fast pace, with fiscal prudence.
India, one of the fastest growing economies in the world, is poised for even greater growth with its young and skilled workforce, rapidly expanding middle class, and a government actively working to improve the business climate. India is an attractive market for companies looking to tap into new opportunities.
The current GDP growth rate, according to Reserve Bank of India is reported to be 7%. For FY24, India’s real GDP is forecasted to grow by 6.5% as per the Economic Survey 2023. Even during Covid, despite India’s GDP contracting by 7.7% in the April-June quarter of 2020, it rebounded with a positive growth rate of 0.4% in the following quarter and continued to recover, with a growth rate of 8.0% and 14.0% in the subsequent July-September and October-December quarters respectively. These figures demonstrate the strength and adaptability of the Indian market, which was able to weather the impact of the pandemic and continue its path of progress.
According to data from the Department of Industrial Policy and Promotion, the FDI inflows into India in FY21 were approximately $74.39 billion, a significant increase from the $64.37 billion in FY20. Similarly, in FY22, FDI inflows reached $64.37 billion in the first half of the financial year, demonstrating the continued confidence of international investors in the Indian market. These figures highlight the growing competitiveness and attractiveness of India as a destination for foreign investment, positioning the country for long-term growth and development.
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