According to CEA Nageswaran, India will grow at over 7% in 2022-23According to Chief Economic Advisor V Anantha Nageswaran, the Indian economy will grow at over 7 percent, down from 8 percent estimated in January. However, he said the economic momentum and animal spirits are “unmistakable”.
According to Nageswaran, India’s growth rates for the current financial year have fallen short of what was projected in January. In his presentation at Global Fintech Fest, he said that growth is being hampered by the effects of the Covid pandemic and the ongoing war in Europe triggered by Russia’s invasion of Ukraine.
The Chief Economic Advisor CEA Dr. V Anantha Nageswaran
Economic Survey released before the annual budget this year has estimated FY23 growth at 8-8.5 per cent. In spite of RBI estimates of 7.2 percent growth, some analysts claim the estimate will be revised downward soon. According to Nageswaran, India will also continue to grow at 7 per cent per year for the remainder of the decade.
During the fintech event, Nageswaran said that the government is shifting from financial inclusion to financial empowerment, and the focus will be on improving access to financial services, including credit and insurance, using the accounts opened earlier. To help the diaspora, the government is working to establish interoperability between Singapore and the UAE’s payment systems, in order to reduce remittance charges to near-zero.
A unified payment interface, he said, mimics the soon-to-be-introduced central bank digital currency, on which India is moving ahead. On the credit front, “we are moving from collateral-based systems to ones that are cash-based,” he said.
Nageswaran estimated the opportunity on cash flow-based lending to be Rs. 3 lakh crore by next year. However, cash flow-based lending apps need to avoid abusing borrowers, especially those with less financial literacy.
Companies should see profit as a means to innovate and not abuse the system, he said. The country needs to move forward with its intellectual property challenges as well, he said, noting that after being just a consumer for many years, it has now created a number of solutions. G-20 countries are interested in understanding the Indian model of partnering with the private sector for better systems, he said.
CEA Dr. V Anantha Nageswaran September 21, Mumbai
In FY23, India’s GDP is likely to grow by 7.2-7.4%, according to CEA Nageswaran
According to Business Standard, India’s gross domestic product (GDP) is expected to grow between 7.2% and 7.4% this financial year as a result of the global economic slowdown. According to the Reserve Bank of India (RBI), GDP will grow by 7.2% this year, while the International Monetary Fund (IMF) expects 7.4%.
The high inflation rate would have reduced consumer appetite and purchasing power, so whether the central banks in the developed world tightened their monetary policy or not, global growth would have been affected. On balance, I believe the slowdown would be good for India, because it exerts a downward pressure on crude oil and other commodity prices, industrial metals, and food supplies in general,” said Nageswaran.
On balance, a slowdown in the West would benefit India: CEA Nageswaran. A number of banks and financial institutions lowered their India growth forecasts after the Q1 GDP print of 13.5%. The list included State Bank of India, Goldman Sachs, Citigroup, and ratings agencies Moody’s, Fitch, and India Ratings.
The RBI is expected to raise the key policy rate by 35-50 basis points on September 30 in response to rising inflation around the world. A Business Standard poll of analysts found most central banks around the world have raised interest rates this year.
We have survived the first six months of the Ukrainian conflict. If we stick to what we have been doing in the last six months, we should be able to achieve the growth rates the RBI and IMF are expecting for India.”
CEA Dr. V Anantha Nageswaran
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