- GDP growth may have slowed to 4.4% in the third quarter (Q3) from 6.3% in Q2, but “growth has not gotten shallower” and the momentum has sustained through the course of 2022-23, the Finance Ministry asserted on Monday.
- Macroeconomic stability was likely to get a further boost this year as the current account deficit was “set to narrow from year-beginning estimates”, the ministry said, citing the jump in net services exports, moderation in oil prices and the recent decline in import-intensive consumption demand.
- The current account deficit is estimated to narrow in FY24 as well, providing a buffer to the rupee “in uncertain times
- This will provide a much needed cushion… at a time when the Fed is likely to raise rates further and ensure that India’s external finances are not a major cause of concern,” the ministry noted in its economic review for February.
- Arguing that the growth momentum could have been higher but for the contraction of Gross Value Added (GVA) in the manufacturing sector, the ministry partly attributed the shrinkage to subdued export growth owing to weaker demand in advanced economies.
SOURCE: THE HINDU, THE ECONOMIC TIMES, PIB