NSO Revises India’s GDP Growth Estimates

March 1, 2024

On March 1st, the National Statistical Office (NSO) updated India’s real GDP outlook for the current and previous two fiscal years. The revisions reflect data from the first advance estimates that incorporate latest production trends across sectors.

Upward Revision for 2023-24

The NSO raised GDP growth expectation for 2023-24 to 7.6% from its January estimate of 7.3%. The upgrade considers sustained resilience across most economic segments despite global headwinds.

For the fiscal ending March 2024, the NSO pegs quarterly growth figures at 8.2% for Q1, 8.1% in Q2 accelerating further to 8.4% in Q3 on robust consumption and investment activity.

Downgrade for 2022-23 Growth

Meanwhile, last fiscal’s (2022-23) real GDP expansion has been downgraded to 7% from the earlier 7.2% as external demand softness may have capped export contribution. The revision aligns with RBI’s recent assessment on 2022-23 growth tapering slightly due to weakening global outlook.

Upward Revision for 2021-22

The agency also upgraded GDP figures for 2021-22 from 9.1% projected earlier to a robust 9.7% driven largely by sharply rising private consumption and fixed investments as pandemic curbs eased.

GVA Growth Adjustments

In line with real GDP changes, national income aggregated from production estimates (GVA) stands adjusted as well.

NSO now expects GVA to rise 6.9% in 2023-24 versus its previous forecast of 7.1%. For 2022-23 and 2021-22, latest GVA growth numbers stand marked at 6.7% and 8.3% against earlier projections of 7% and 7.6% respectively.

Sector-wise Trends

The upgrades accompany faster growth recorded by trade, hotels, transport and communication sectors in Q3 (Oct-Dec 2023) over previous forecasts. Farm sector expansion in 2022-23 has moderated slightly though still robust.

Industrial growth is seen accelerating through 2023-24, aided by improved mining, manufacturing and construction activity. Services remain resilient with spurts in finance, real estate and professional services in recent months.

Way Forward

With high frequency indicators signalling sustained momentum, India is expected to remain the world’s fastest growing major economy over coming quarters.

Timely policy interventions by RBI and government to bolster investments, credit flow and infrastructure allocations have fostered macro stability conducive for growth.

As global headwinds persist however, pragmatic calibration of spending and export-friendly strategies are vital to extend the current upcycle. Sustaining consumption and employment revival also remains imperative amid widening inequality risks.

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