In the first quarter of the ongoing financial year (April-June), India's Gross Domestic Product (GDP) experienced a significant acceleration, reaching 7.8%. This data, released by the Ministry of Statistics and Programme Implementation, marks a notable increase from the previous financial year's fourth-quarter growth of 6.1%.
The Reserve Bank of India had predicted a 7.8% GDP growth rate for this quarter, aligning closely with a Reuters poll of economists, which estimated a 7.7% growth rate. Economists at the State Bank of India were even more optimistic, pegging growth at 8.3%. Although this falls short of the 13.5% GDP growth recorded in the first quarter of the previous year, India's economy is steadily progressing and is expected to further improve during the upcoming festive season.
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Despite concerns expressed by economists about inflation and unpredictable weather affecting economic growth, India's manufacturing, services, and export sectors have shown robust growth. Additionally, the country has seen strong tax collection. Finance Minister Nirmala Sitharaman expressed confidence in the nation's economic outlook, stating that robust growth is expected until the end of the year. She anticipates that demand will continue to rise in the coming quarter.
Sitharaman stated in an interview with The Economic Times, "Till after the new year, you would have enough reasons to believe that the demand situation is going to only go up." She expressed optimism about the upcoming quarter, expecting it to perform well.
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Government data reveals that India's fiscal deficit for the first four months of the 2023-24 financial year stands at 33.9% of the full-year target. In absolute terms, the fiscal deficit, which represents the gap between government expenditure and revenue, amounted to Rs 6.06 lakh crore by the end of July. This data, released by the Controller General of Accounts (CGA), contrasts with the deficit of 20.5% of the Budget Estimates during the same period in the previous financial year (2022-23).
India's key infrastructure sectors experienced growth of 8% in July 2023, a significant increase from the 4.8% growth recorded in the same month the previous year. This growth was driven by expanded production in coal, crude oil, natural gas, steel, cement, and electricity, as indicated by official data released by the Commerce and Industry Ministry.
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Although the core sector's growth rate dipped slightly compared to the previous month when it stood at 8.3%, the overall expansion in key infrastructure sectors is a promising sign of economic vitality and development in India.
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