NEW DELHI: The Indian economy is likely to grow at a rate of 7 % in the current fiscal, against the 8.7 % growth in 2021-22, the National Statistical Office (NSO) said on Friday.

Economists believe that the GDP growth will moderate to 6–6.1% in FY24 in response to the NSO's prediction.

When the NSO released the first preliminary estimates of National Income for 2022–2023 "Real GDP (gross domestic product) or GDP at Constant (2011–12) Prices is predicted to be Rs. 157.60 lakh crore in the years 2022–23 as opposed to the Provisional Estimate of GDP for the years 2021–22, which was announced on May 31, 2022, which was Rs. 147.36 lakh crore. Compared to 2021–2022, the growth in real GDP is predicted to be 7.0% in 2022–2033 ".

Because of ongoing geopolitical unrest and monetary tightening, the RBI reduced its earlier projection of the current fiscal year's GDP growth to 6.8% from 7% in December 2022.

Rajani Sinha, Chief Economist at CARE Ratings, said: "India's economy expanded by 7% in FY23, helped by the services industry. The industrial sector, which has been struggling due to high input costs, experienced minimal growth, as was to be expected. With the economy returning to normal after the epidemic and high pent-up demand, spending growth in consumption and investment was resilient. The government's increase in capex has also helped the economy expand. A widening of net exports caused by the slowing of global economy slowed the expansion of the GDP as a whole. "Given the obstacles that lie ahead on the global front, India's export growth is probably going to slow down in FY24. Although commodity prices will moderate, the manufacturing sector will still be hurt by a decline in external demand. There may be some fading of the pent-up demand that was there in the services sector in FY23.

The primary obstacle will be a sustained uptick in private investment amid rising borrowing costs, demand uncertainty, and the global slowdown, she noted. The government will continue to concentrate on capital spending.

Given the global obstacles and potential effects on the Indian economy, Sinha stated, "we predict the GDP growth to decelerate to about 6.1 percent in FY24."

Another credit rating agency, CRISIL, predicts that real GDP growth would decelerate to 6% in the upcoming fiscal year, with risks leaning to the negative.

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