GDP GROWTH

First Advance Estimate (FAE) of National Accounts for the current year is released by Ministry of Statistics and Programme Implementation (MoSPI) on 7th January, if it is a working day, else on previous working day, using the provisional estimate (PE) of previous financial year (FY) as benchmark. However, First Revised Estimate (FRE) of the previous financial year used to be released on last working day of January, that is one day before the presentation of Union Budget. That was creating confusion among users as they were recomputing growth of current year using FRE released one day before, instead of growth rate published in Economic Survey. Therefore, in consultation with stakeholder agencies, FRE has been made coterminous with the release of Second Advance Estimate (SAE) from the current financial year onward, that is on the last working day of February.

GDP growth rate at constant (2011-12) prices during last three FYs are as follows:

(RE-Revised Estimates, PE- Provisional Estimates)

From the above table, it is evident that FY 2020-21 witnessed a contraction of 5.8 per cent. Because of low base in 2020-21, the growth rate in 2021-22 was registered high as 9.1 per cent. But in 2022-23, the growth rate 7.2 per cent is on high base (9.1 percent of 2021-22). Therefore, the said growth of 7.2 per cent in 2022-23 is healthy.

Government over the past few years have taken various initiatives that have contributed to the high growth of the Indian economy. Policy support has included the introduction and application of the Insolvency and Bankruptcy Code (IBC), Goods and Services Tax Reform, cut in the Corporate Tax Rate, the Make in India and Start-up India strategies, and Production Linked Incentive Schemes, among others. Government has also focused on capex led growth strategy and substantially increased its capital investment outlay during the last three years.

The Union budget 2023-24 has taken further steps to sustain a high growth of India's economy. These include a substantial increase in capital investment outlay for the third year in a row by 33 per cent to ₹10 lakh crore (3.3 per cent of GDP), the enhanced outlay for PM Awas Yojana, the launch of the Aspirational Blocks Programme covering 500 blocks for saturation of essential government services; increase in agriculture credit target to ₹20 lakh crore with a focus on animal husbandry, dairy and fisheries; and setting up of Agriculture Accelerator Fund to encourage agri start-ups by young entrepreneurs in rural areas, among others. Direct capital investment by the Centre is also complemented by Grants-in-Aid to States for the creation of capital assets. The ‘Effective Capital Expenditure’ of the Centre was accordingly budgeted at ₹13.7 lakh crore (4.5 per cent of GDP) for 2023-24. To increase private investment in infrastructure, the newly established Infrastructure Finance Secretariat will provide oversight. Further, to improve logistics performance, one hundred critical transport infrastructure projects for last and first mile connectivity for ports, coal, steel, fertilizer, and food grains sectors have been identified and will be prioritised for development.

Growth rate of Gross Value Added (GVA) at Constant (2011-12) Prices in the manufacturing sector in the FY 2020-21, FY 2021-22 and FY 2022-23 are 2.9 per cent, 11.1 per cent and 1.3 per cent respectively. From this, it is evident that the Manufacturing sector registered very high recovery during FY 2021-22 by observing 11.1 per cent growth. Because of very high base, growth of this sector at 1.3 per cent appears subdued.

It is further noted that the growth rate of 1.6 per cent and 9.9 per cent for the FY 2022-23 and FY 2021-22, mentioned in the question, has now been revised to 1.3 per cent and 11.1 per cent as per latest provisional estimate published on 31st May, 2023.

This information was given by the Minister of State (I/C) for the Ministry of Statistics and Programme Implementation, Ministry of Planning and Minister of State in the Ministry of Corporate Affairs, Rao Inderjit Singh in a written reply in the Lok Sabha today