India’s GDP grows by 13.5% in the April-June quarter of 2022; Fastest in a year

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India’s gross domestic product (GDP) grew by 13.5% in the June quarter 2022 (Q1FY23) compared to the 20.1% growth recorded in Q1 2021-22, according to the latest official data published on Wednesday. This is the fastest growth in a year, with the country’s GDP growing 4.1% in the previous quarter (Q4FY22), 5.4% in the December 2021 quarter of FY 22 and 8.4% in the September 2021 quarter.

“Real GDP or Gross Domestic Product (GDP) at constant prices (2011-12) in the first quarter of 2022-23 is expected to reach a level of Rs 36.85 lakh crore, compared to Rs 32.46 lakh crore in the first quarter of 2021- 22, showing growth of 13.5% compared to 20.1% in the first quarter of 2021-22,” according to an official statement.

According to the latest data released by the Office for National Statistics (ONS), from April to June 2022, the country’s Gross Value Added (GVA), which is GDP minus net taxes on products and reflects the growth of l supply, increased by 12.7%.

Agriculture, manufacturing and services GVA

Agricultural GVA in the April-June 2022 quarter jumped 4.5% from 2.2% in the prior year quarter. It had risen 3% in the previous quarter of March 2022.

Manufacturing grew by 4.8%, compared to 49% recorded a year ago. It had contracted by 0.2% in the January-March 2022 quarter.

During the first quarter of the current financial year, trade, hotel, transport, communication and broadcasting-related services recorded a growth of 25.7%, lower than the 34.3% recorded during of T1FY22. This is higher than the 11.1% increase recorded in the previous quarter.

Nominal GDP growth, which takes inflation into account, slowed to 26.7% in Q1FY23 from 32.4% in April-June 2021. “Nominal GDP, or GDP at current prices, in Q1 2022-23 is estimated at Rs. 64.95 lakh crore, compared to Rs 51.27 lakh crore in the first quarter of 2021-22,” according to the official statement.

Gross fixed capital formation, which is an indicator of investment activity in the country, increased by 20% in the June quarter of 2022, down from 62.5% a year ago.

Private final consumption expenditure (PFCE) and general government final consumption expenditure (GFCE) grew by 9.9% and 9.6% respectively during 1TQFY20.

GDP growth in Q1FY23: expert comments

Aditi Nayar, chief economist at CIFAR, said: “GDP growth hit a four-quarter high of 13.5% in the first quarter of fiscal 2023, broadly in line with our estimate of 13 percent and well below the RBI MPC projection of 16.2 percent. hundred. GDP growth will certainly slow in the second quarter of fiscal 2023 as the base effect normalizes, as underlined by the moderation in core sector growth in July 2022.”

Nayar said an uneven monsoon is likely to weigh on agricultural GVA growth and rural demand. “However, robust demand for services and some easing of the pain inflicted on producers by commodity prices should support year-over-year GDP growth of 6.5-7% in the quarter in course and 7.2% for the year as a whole.”

She said GDP growth of 13.5% was boosted by private final consumption expenditure and gross fixed capital formation, while government final consumption expenditure posted an anemic 1.3% growth. year-on-year.

Sunil Kumar Sinha, Senior Economist at India Ratings and Research, said: “Although the quarterly GDP growth figures for 1QFY23 are influenced by the base effect, it nevertheless indicates that the recovery is underway despite the headwinds. world markets, high commodity prices, especially oil and weakening of the INR. Several high-frequency indicators such as commercial vehicle sales, passengers handled at airports, cement production, rail freight/passenger and used in the 1QFY23 GDP estimate also showed reasonable year-on-year growth. .

Analysts had predicted GDP growth in the first quarter of FY23 in the range of 13-16.2%. Rating agency Icra expects India’s GDP to grow 13% in the first quarter of FY23, the State Bank of India (SBI) recorded 15.7% growth and the RBI forecast it at 16.2%.

In the previous quarter (Q4FY22), the country’s GDP grew by 4.1%. For the full fiscal year 2021-22, GDP grew by 8.7%.

China recorded economic growth of 0.4% in April-June 2022.

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