Here Is What Various Estimates Say

India’s Q2 GDP Growth: As gross domestic product (GDP) data for the July-September 2022 quarter is due for release on Wednesday (November 30), analysts have given a wide range of growth forecasts from 5.8 per cent to 7 per cent. Rating agency Icra expects India’s GDP to grow 6.5 per cent in Q2FY23, State Bank of India (SBI) sees a 5.8 per cent growth, rating agency Crisil forecasts it at 7 per cent, and the RBI sees the country’s GDP growth at 6.3 per cent in the September 2022 quarter.

Most agencies recently revised downwards India’s Q2 GDP forecast, as global economic headwinds from extended geopolitical tensions, tightening global financial conditions and possible decline in the external component of aggregate demand pose downside risks to growth.

ICRA Forecast For Q2

ICRA in its report has said GDP growth over the pre-Covid levels is expected to double to around 8 per cent in Q2 relative to 3.8 per cent seen in the previous quarter. The agency estimates the sectoral growth in Q2 to be driven by the services sector (9.4 per cent), with a subdued trend foreseen for the industry (2 per cent), and agriculture, forestry and fishing (2.5 per cent).

Its Chief Economist Aditi Nayar expects a 6.5 per cent growth in Q2 of the current fiscal, nearly half of the year-ago quarter when the economy had clipped at 12.7 per cent, but which is still a tad higher than the monetary policy committee’s September forecast of 6.3 per cent and at 6.5 per cent in gross value added (GVA) less than half of 13.5 per cent a year ago.

She estimates GDP growth in Q2 FY2023 at 6.5-6.7 per cent.

Crisil Forecast For Q2

Rating agency CRISIL in its report said it has revised down its forecast for real gross domestic product growth to 7 per cent for fiscal 2023 from 7.3 per cent, primarily because of the slowdown in global growth that has started to impact exports and industrial activity. This will test the resilience of domestic demand.

It expects India’s GDP to grow at 7 per cent in the second quarter. Its chief economist D K Joshi said domestic demand still remains supportive, helped by a catch-up in contact-based services, government capex, relatively accommodative financial conditions, and overall normal monsoons for the fourth time in a row.

SBI Forecast For Q2

SBI Research expects India’s Q2 GDP growth for the second quarter at 5.8 per cent. In a report on Monday, SBI Research headed by Soumya Kanti Ghosh said corporate results, operating profit of companies, excluding banking and financial sector, degrew by 14 per cent in Q2FY23 as against 35 per cent growth in Q2FY22, though the top line continued to grow at a healthier pace. Net sales grew by 28 per cent, while bottomline (profit) was down by around 23 per cent from the year-ago period.

Ghosh, however, said several indicators suggest that the economy has been making resilient progress since Q2 in spite of the drag from global spillovers, elevated inflation and some slackening of external demand as geopolitical developments take their toll on world trade.

RBI’s Q2 GDP Forecast

The Reserve Bank of India (RBI) expects India’s GDP to grow 6.3 per cent in the September 2022 quarter. Its Governor Shaktikanta Das, while announcing MPC decisions at the end of September, said the headwinds from extended geopolitical tensions, tightening global financial conditions and possible decline in the external component of aggregate demand can pose downside risks to growth.

He, however, said that despite the unsettling global environment, the Indian economy continues to be resilient and there is a macroeconomic stability. The financial system remains intact, with improved performance parameters. The country has withstood the shocks from COVID-19 and the conflict in Ukraine.

In the previous quarter of April-June 2022, India’s GDP rose 13.5 per cent as compared with the 20.1 per cent growth registered in Q1 2021-22. It was the fastest growth in a year, as the country’s GDP had grown at 4.1 per cent in the previous quarter (Q4FY22), 5.4 per cent in the December 2021 quarter of FY22, and 8.4 per cent in September 2021 quarter.

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