New Delhi, Dec 16, Buzzbytes:
Recent economic data for the July to September period reveals a robust growth in India’s Gross Domestic Product (GDP), reaching 72 lakh crores compared to 66 lakh crores in the same period last year. Adjusting for inflation, the real GDP growth stands at an impressive 7.6 percent, surpassing the previous year’s 6.2 percent.
Driving this growth are substantial increases in government and investment spending, growing at rates of 19 percent and 13 percent, respectively. In contrast, consumer spending, constituting 60 percent of GDP, has only risen by 8 percent, or around 3 percent when adjusted for inflation.
While the current growth is commendable, sustaining it in the medium to long term hinges on boosting consumer spending, requiring parallel growth in employment, wages, and retail loans. The government’s role in stimulating economic activity is crucial, with expectations of increased fiscal impetus leading up to the 2024 national elections.
The challenge lies in balancing fiscal prudence, policy stability, and price control to ensure sustained growth. Furthermore, microeconomic data, such as the Periodic Labour Force Survey, is needed to assess how these economic gains translate into benefits across different income categories, ensuring inclusive growth.
