Budget 2023: Indian economy to grow at 7% in FY23, says FM

Union Finance Minister Nirmala Sitharaman, while presenting Union Budget 2023-24 in Parliament today, said the Centre sees the country's economy growing at 7% in the current financial year 2022-23. She said this will make India one of the highest-growing economies in the world.

"The world has recognised India as a bright star, our growth for the current year is estimated at 7.0%, this is the highest among all major economies, in spite of massive global slowdown caused by pandemic and the war," the FM said during her Budget 2023-24 speech.

The FM says it's the first Budget in the "Amrit Kaal" announced by the Prime Minister, which refers to the next 25 years of independent India as it achieves 100 years of freedom by 2047. Notably, the PM has said India will strive towards becoming a "developed nation" in the "Amrit Kaal" period. "This budget hopes to build on the foundation laid in the previous budget and the blueprint laid for India@100, we envision a prosperous and inclusive India in which the fruits of development reach all."

The Economic Survey released on January 31, 2022, also stated agencies worldwide have projected India as the "fastest-growing major economy" at 6.5-7% in FY23. "These optimistic growth forecasts stem in part from the resilience of the Indian economy seen in the rebound of private consumption seamlessly replacing the export stimuli as the leading driver of growth."

The Survey said even as India’s outlook remains “bright”, global economic prospects for the next year have been weighed down by challenges expected to impart a few downside risks. The upside to India’s growth outlook, as per the Survey, arises from -- limited fallout from the Covid-19 surge in China; inflationary impulses from the reopening of China’s economy turning out to be neither significant nor persistent; recessionary tendencies in major AEs triggering a cessation of monetary tightening and a return of capital flows to India amid a stable domestic inflation rate below 6%; and this leading to an improvement in animal spirits and providing impetus to private sector investment.

The government has said the Survey projects a baseline GDP growth of 6.5% in real terms in FY24.

The FM said the Indian economy is on the right track, heading to a bright future. "Our focus on reforms and sound policies resulting in Jan Bhagidari helped us in trying times, our rising global profile is due to several accomplishments."

The FM also talked about the G20 Presidency, saying it gives India a "unique opportunity" to strengthen its role in the world economic order. "We are steering an ambitious people-centric agenda to address global challenges and facilitate sustainable economic development."

The FM says the Indian economy has increased in size from being 10th to 5th largest in the world in the past 9 years. The country, she adds, has made significant progress in many SDGs. "Economy has become a lot more formalised, efficient implementation of schemes has brought about inclusive development."