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Slowdown in manufacturing dragged down the GDP growth in Q3 FY23. However, India remains a bright spot for the world with 7% growth expected for the FY 2022-23. Signs of recovery of rural demand and resilience of fixed investment and services offer hope

Growth below expectation. The 4.4% GDP growth in Q3 FY23 was below the expectations. The fall in growth rate can be partly attributed to the upwardly revised GDP for the corresponding period of the last year by Rs. 290 billion.

Fixed investment growth remain strong. Investment growth remained strong during the quarter with 8.3% growth. Private consumption growth slowed to 2.1%. Government consumption contracted. Exports posted strong growth.

Manufacturing dragged growth, agriculture, services delivered. Soft global demand lead to contraction of more externally-oriented manufacturing sector. Resilience of agriculture and services helped clocking respectable growth.

India likely to be the fastest-growing major economy. Despite slowdown in Q3 FY23 versus Q2 FY23, India remains top-5 among the G-20 economies in terms of GDP growth. The IMF expects India to be fastest growing major economy in 2022 and 2023.

Expect ~7% growth in FY23 and 6-6.5% in FY24. Expect modest recovery in industry and resilience of services.

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