FICCI downgrades India’s GDP growth forecast for 2022-23 to 7%

Industry body FICCI on Thursday said India’s economy is estimated to grow 7 per cent in the current fiscal, lower than the earlier projection of 7.4 per cent, mainly due to the ongoing geopolitical uncertainties. Owing to geopolitical uncertainties and their impact on Asia’s third largest economy.

However, in its latest round of Economic Outlook Survey (July 2022), it revised the growth projection on account of geopolitical uncertainty and its repercussions for the Indian economy. The present round of surveys that drew responses from leading economists representing the industry, banking, and financial services sector, was conducted in the month of June 2022.

Why does this downgrade happen?

The industry body listed rising commodity prices, supply-side disruptions, and bleak global growth prospects with the conflict prolonging in Europe as major risk factors to India’s economic recovery. FICCI estimated India’s retail inflation rate at 6.7% for 2022-23, with a minimum and maximum range of 5.4% and 7.0% respectively, which is in line with RBI’s projections. It further expected the inflation levels to slow down starting September 2022 and fall back into the 4% range only by June 2023.