India to Grow at 7% in FY23: CEA KV Subramanian

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India to Grow at 7% in FY23: CEA KV Subramanian
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By Aditya Raghunath -- At a virtual event organised by BASE University, Chief Economic Advisor (CEA) KV Subramanian said that India is likely to hit a growth rate of 6.5%-7% starting FY23. It will then move up to 8% on the back of government reforms.

“Our projection is that from FY23, we should be hitting a growth of 6.5-7%… accelerating from there onwards hitting between 7.5%-8% as the impact of all these reforms is felt both on the investment rate, which will start touching 40%, and the incremental capital output ratio, basically productivity, which will also improve,” he said.

He added that the International Monetary Fund (IMF) had projected a growth rate of 8.5% for FY23. The IMF has cut India’s GDP forecast to 9.5% from 12.5% for FY22, as it calculated the impact of the second pandemic wave on the country’s economy.

"Growth prospects in India have been downgraded following the severe second COVID wave during March–May and expected slow recovery in confidence from that setback," IMF said in its latest World Economic Outlook report.

IMF’s forecast is in line with the Reserve Bank of India’s revision to 9.5% from 10.5% earlier. In June, S&P had also revised downwards its forecast for India to 9.5% in FY22.


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