The Reserve Bank of India (RBI) in its Annual Report 2022-23 has said the Indian economy turned out to be one of the “fastest-growing major economies during 2022-23 with the real gross domestic product (GDP) growing by an estimated 7 per cent”. The GDP growth rate is an essential indicator of the country’s economic development and progress. It indicates that the economic health of the country in the two previous financial years (FYs) after the pandemic is positive.
The RBI takes data from eight sectors to calculate GDP at factor cost. The eight sectors are agriculture, forestry and fishing; mining and quarrying; manufacturing; electricity and gas supply; construction; trade, hotel, transport and communication; financing, real estate and insurance; and public administration, defence and other services. For the financial year 2022-23, the three quarterly estimates of gross value added (GVA) at basic price (at constant prices in rupees crore) are shown in the table below:
According to the RBI, for the economic review of the previous three FYs, “GDP growth numbers were revised up by 20 bps (2019-20), 80 bps (2020-21) and 40 bps (2021-22) indicating that the growth momentum is stronger than what early estimates suggested.”
On February 28, 2023, the second advance estimates (SAE) of national income, released by the National Statistical Office (NSO), also indicated that aggregate demand (a real GDP measurement) registered a growth of 7 per cent in 2022-23. The real GDP growth percentage in the last five FYs were 6.5 in 2018-19, 3.9 in 2019-20, -5.8 in 2020-21, 9.1 in 2021-22 and 7 in 2022-23 respectively.
Also, the report of National Account Statistics shows the GDP in the FY 2022-23 is 7.2 per cent.
What is GDP?
GDP stands for gross domestic product. It is an essential economic indicator of a country of the total value of goods and services produced in a country. It is measured quarterly (every three months) and annually. A positive GDP growth rate not only helps the government frame policies but is also useful to attract investors in terms of foreign direct investments (FDI).
Real GDP is used to adjust inflation or deflation. It is expressed in dollars.
According to the latest official data, the country’s gross domestic product grew by 6.1 per cent in the fourth quarter of fiscal year 2022-23. For the entire FY23, the growth rate came in at 7.2 per cent.
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