The third-largest economy in Asia expanded by 8.4% during the October–December quarter, considerably quicker than the 7.6% growth seen in the preceding three months and far faster than the 6.6% predicted by Reuters polling analysts.
According to India Ratings analyst Sunil Kumar Sinha, “the ongoing growth momentum is indicative of the Indian economy’s resilience, notwithstanding global headwinds.” He also noted that the quarter saw maintained strong industrial development.
With China still failing to recover from the epidemic and the euro zone just avoiding recession, India’s economy is among the fastest growing in the world and has routinely outperformed market predictions.
India updated its growth projection from 7.3% to 7.6% for the current fiscal year, which ends on March 31.
Modi’s chances might be enhanced by such a great performance in the final significant economic data release before the May elections, because he has made robust economic growth a central tenet of his campaign trail speeches.
In a social media post, Modi stated that the rise in December “shows the strength of Indian economy and its potential.”
In an effort to help India compete with nations like Vietnam and Thailand, Modi has drastically increased government expenditure on infrastructure and provided incentives to increase the production of phones, electronics, drones, and semiconductors.
In the December quarter, the manufacturing sector, which has grown to make up 17% of Asia’s third-largest economy over the last ten years, rose by 11.6% year over year. Investment growth exceeded 10% for the second consecutive quarter, while the construction industry climbed by more than 9%.
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According to CareEdge economist Rajani Sinha, “lower input costs supported manufacturing sector growth.”
60% of the GDP is derived from private spending, which increased 3.5% year over year during the quarter after declining 2.4% over the prior three months.
Spending by the government decreased 3.2% annually in the preceding quarter after growing 1.4% in the previous one.