On Tuesday, two promising developments provided a strong aliyah to India’s robust economic prospects of growing at 7% (in real terms) for the fiscal year ending March 2023. Crediting growth to the micro, small, and medium enterprises (MSMEs) sector at a remarkably high rate of over 30.5 percent on average during January–November 2022, an increase in capital expenditures (Capex) of 63.4 percent in the first eight months of FY23, and a surge in export growth in FY22 and the first half of FY23 all contribute to the growth. The Econometric Survey 2022–23, which Finance Minister Nirmala Sitharaman tabled in Parliament on Tuesday, highlights a recovery from pandemic-induced contraction, Russian-Ukrainian conflict, and inflation. The Indian economy is staging a broad-based recovery across sectors, positioning itself to resume pre-pandemic growth in FY23. During 2014–2022, the Indian economy underwent extensive structural and governance reforms, which strengthened the economy’s fundamentals by increasing overall efficiency. Among the other growth drivers of the economy in the current year are private consumption, which as a percentage of GDP stood at 58.4 percent in July-September Q2 of FY 23, the highest among the second quarters of all the years since 2013-14 and supported by a rebound in contact-intensive services such as trade, hotel, and transport.
