- The main reason for this revision was the higher capital expenditure proposed in the Union Budget 2023-24, which aimed to boost infrastructure spending and revive the economy after the Covid-19 pandemic. Moody's also cited a sustained economic momentum as a positive factor for India's growth outlook.
- Moody's also raised its growth projections for other G-20 economies such as the US, Canada, the Euro area, Russia, Mexico and Turkiye, accounting for a stronger end to 2022.
- According to Moody's, India had the highest growth rate of all G-20 countries followed by China at 5% and Indonesia at 4.8%.
- For fiscal 2023-24, the Reserve Bank of India has projected real GDP growth at 6.4% while the Economic Survey had estimated it in the range of 6% to 6.8%.
- Moody's said that India's growth outlook was supported by a strong recovery in private consumption and investment, as well as a favourable base effect from the sharp contraction in 2022.
- Moody's also noted that India's fiscal deficit target of 6.8% of GDP for 2023-24 was higher than expected, but it reflected a credible commitment to fiscal consolidation and transparency.
- Moody's said that India's credit profile remained constrained by low per capita income, high public debt, weak financial sector and governance challenges.
- Moody's also warned that India faced downside risks from potential new waves of Covid-19 infections, geopolitical tensions with China and Pakistan, social unrest and environmental shocks.
Question:
Q.1 What was India’s GDP growth projection for 2023 by Moody’s in November 2022?
a. 4.8%
b. 5.0%
c. 5.2%
d. 5.4%
