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The Indian government is optimistic about export growth while it is less optimistic on private consumption expenditure.

According to Motilal Oswal Financial Services Ltd, the government's export growth forecast is 12.5 per cent year-on-year (YoY -11.9 per cent YoY in 2HFY23) while it pegs it at 7.8 per cent YoY in FY23 (5.4 per cent YoY in 2HFY23).

"On the contrary, the government appears less optimistic than we are on private consumption expenditure. While CSO estimates it to grow 7.7 per cent YoY in FY23 (-0.2 per cent YoY in 2HFY23), we expect a growth of 11.8 per cent YoY during the year (6.6 per cent in 2HFY23)," said Motilal Oswal.

The Central Statistics Office (CSO) has pegged real GDP growth at 7 per cent YoY in FY23E, similar to our forecast of 6.9 per cent, but slightly higher than the Reserve Bank of India's (RBI) assumption of 6.8 per cent YoY, Motilal Oswal said.

According to the company, the real gross domestic product (GDP) is, therefore, likely to grow 4.5 per cent YoY in 2HFY23.

However, CSO forecasts nominal GDP growth at 15.3 per cent YoY in FY23, the company's estimate of 14.7 per cent YoY, Motilal Oswal said.

"Our estimates are broadly in-line with that of the government's for most of the GDP components. While CSO estimates the government consumption to grow 3.1 per cent YoY in FY23 (7.2 per cent YoY in 2HFY23), we expect it to rise 3 per cent YoY (6.9 per cent YoY in 2HFY23).

"The government expects gross capital formation (GCF) to grow 10.6 per cent YoY (9.4 per cent YoY in 2HFY23) while our forecast for the same stands at 9.8 per cent YoY in FY23 (7.6 per cent YoY in 2HFY23)," Motilal Oswal said.