India's GDP Growth Forecast: Quarterly Projection of Real GDP Growth & Weighted Contribution to GDP Growth

Professional forecasters polled in the March 2022 round of the Reserve Bank’s survey expected real GDP growth at 3.9 per cent in Q4:2021-22, 14.0 per cent in Q1:2022-23 (due to favourable base effects), 6.4 per Taking into account the baseline assumptions, including crude oil (Indian basket) at US$ 100 per barrel.

The survey indicators, and model forecasts, real GDP growth is expected at 7.2 per cent in 2022-23 - Q1:2022-23 at 16.2 per cent; Q2 at 6.2 per cent; Q3 at 4.1 per cent; and Q4 at 4.0 per cent – with risks evenly balanced around this baseline path.

For 2023-24, assuming a normal monsoon, and no major exogenous or policy shocks, the structural model estimates indicate real GDP growth at 6.3 per cent, with quarterly growth rates in the range of 5.9-6.8 per cent.

There are upside and downside risks to the baseline growth path. Upside risks to the baseline trajectory could emanate from stronger and sustained expansion in domestic demand, including for contactintensive services, a boost to private investment activity from the confluence of government’s thrust on capital expenditure, and healthier corporate balance sheets. On the contrary, the heightened geopolitical tensions – resulting in the significant hardening of international crude oil and other commodity prices to multi-year highs, the upsurge in global financial market turmoil and the loss of momentum in global trade and demand – pose sizeable downside risks to the baseline growth path.