New Delhi: India will still grow at 6-7 percent in the next 2023-24 fiscal even as the economy may be affected by uncertain global conditions, former Niti Aayog Vice-Chairman Rajiv Kumar has said amid growing fears of the world slipping into a recession. Kumar further said there is a synchronized downturn in the US, Europe, Japan, and also in China and that could take the global economy into a recession in the coming months.
“Thankfully, there is no such prospect of recession in India, because although our growth may be negatively affected by the global conditions, we will still manage to grow at 6-7 percent in 2023-24,” he told PTI in an interview. (Also Read: Explained: Is the Digital rupee future of money? Will it successfully boost the Indian economy?)
The World Bank on October 6 projected a 6.5 percent growth rate for the Indian economy for 2022-23, a drop of one percentage point from its June 2022 projections, citing the deteriorating international environment, while IMF projected a growth rate of 6.8 percent in 2022 as compared to 8.7 percent in 2021 for India. (Also Read: “Don’t buy TV, fridge”: Jeff Bezos gives recession warning to customers, asks to prepare for the worst)
Replying to a question on high inflation, Kumar said retail inflation will probably be in the range of 6-7 percent for some more time. “After that, my estimate is that it should begin to peak and then come down,” he said. Kumar added that depends a lot on global oil prices as they can continue to rise because of the continued conflict in Ukraine.
Asked about the impact of a weakening Indian rupee on the common man, the former Niti Aayog vice chairman said the common Indian does not use a lot of imported goods or services in their consumption basket. According to Kumar, the rupee which is near its real value is much better for the economy than the appreciated rupee and depreciated rupee doesn’t pose many downside risks.
On India’s widening trade deficit, Kumar said with the negative growth of exports in October, it is clear that the country needs a real policy focus on this area on how to expand its exports of both goods and services. “We need to now formulate state-specific export promotion policies. Because to have one single export promotion policy for the whole country does not make sense,” he said.
Elaborating further, he said that like Punjab is a double landlocked state and Tamil Nadu is a coastal state, and it has centuries of trading experience. “So, to have the same policies of both those states, for example, is not relevant,” he emphasised.