Economy on right track; to grow at 7% in FY23: FM Nirmala Sitharaman

However, the Centre’s GDP growth projection for FY23 is slightly higher than the Reserve Bank of India’s (RBI) real GDP growth estimate of 6.8 per cent for the current fiscal.

“Our vision for the Amrit Kaal includes technology-driven and knowledge-based economy with strong public finances, and a robust financial sector. To achieve this, Jan Bhagidari through Sabka Saath Sabka Prayas is essential,” Sitharaman said.

The economic agenda for achieving this vision focuses on three things – facilitating ample opportunities for citizens, especially the youth; providing strong impetus to growth and job creation, and strengthening macro-economic stability, she said.

As per the First Advance Estimates of National Income for 2022-23, India’s real GDP and nominal GDP are projected to grow by 7 per cent (y-o-y) and 15.4 per cent (y-o-y), respectively. For 2023-24, the Union Budget has projected nominal GDP growth at 10.5 per cent.

While speaking to reporters in a post-Budget press conference, Finance Secretary TV Somanathan said, “Our number of 10.5 per cent (growth in nominal GDP for FY2024) could come from any combination of inflation and real growth. We are reasonably confident that we will exceed 10.5 per cent nominal growth for the purposes of estimating our revenue.” To push growth further, the Centre has increased the capital investment outlay steeply for the third year in a row by 33 per cent to Rs 10 lakh crore, or 3.3 per cent of GDP, for fiscal 2023-24.

“This substantial increase in recent years is central to the government’s efforts to enhance growth potential and job creation, crowd in private investments, and provide a cushion against global headwinds,” the Finance Minister added.

In the last nine years, she said, the Indian economy has increased in size from being 10th to 5th largest in the world. It has significantly improved its position as a well-governed and innovative country with a conducive environment for business as reflected in several global indices, she added.

“The economy has become a lot more formalised as reflected in the EPFO membership more than doubling to 27 crore, and 7,400 crore digital payments of Rs 126 lakh crore through UPI in 2022,” she said.

On inflation, Sitharaman said inflation has already moderated to some extent due to the measures taken by the government and RBI. The government does not “look the other way” when inflation is high and it has “kept attending to” the problem of high inflation, she added.

In December, the Consumer price-based inflation (CPI), or retail inflation, eased to 5.72 per cent from 5.88 per cent in November.