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The Annual Economic Review released by Finance Ministry said that India’s GDP grew by 7.2% in FY23, which is the highest among major economies.
Despite marginal decline in the rate of growth compared to the previous year, India still manages to be one of the fastest growing economies in the world. Let us look at the picture to know more.
What works for India’s economy is revival in domestic demand post covid, points out the report. The Finance Ministry said, “The domestic demand has, however, recovered since then and moved from strength to strength in FY23. In the process, it enabled a near convergence of the pre- and post-pandemic quarterly growth trajectories."
The report also attributes this growth to growing employment. “Growing employment levels, in part, have been an outcome of several policy measures implemented over the last few years. These measures strengthened the corporate sector, supported small enterprises, improved the ease of doing business, and attracted foreign capital to increase the employment generation capacity of the economy," it stated.
However, the report cautioned that escalation of geopolitical stress, enhanced volatility in global financial systems, sharp price correction in global stock markets, a high magnitude of El-Nino impact and modest trade activity and FDI inflows, could constrain the pace of growth.
