Moodys raises India growth forecast to 5.5%

Moody’s Investors Service raised India’s economic growth estimate for 2023 to 5.5 per cent from 4.8 per cent pegged earlier, on the back of a sharp increase in capital expenditure in the Budget and a resilient economic momentum.

The central government continued with its capital expenditure push in the recently announced Union Budget. In 2023-24, capex is budgeted at Rs 10 lakh crore which will constitute 3.3 per cent of GDP. The RBI in its Bulletin said that if effectively implemented, it can take India’s real GDP growth close to 7 per cent in FY24.

“The Union Budget 2023-24’s emphasis on capital expenditure is expected to crowd-in private investment, strengthen job creation and demand, and raise India’s potential growth,” said the article authored by a team lead by RBI Deputy Governor Michael Debabrata Patra.