Bank of Baroda pegs GDP growth at 4.6% for Q3, 6.8% for FY23

Bank of Baroda estimates GDP growth for Q3FY23 to be 4.6 per cent and for FY23 at 6.8 per cent, according to Economist Jahnavi Prabhakar.

The GDP growth estimates are scheduled to be released on February 28.

While the Indian economy has been relatively insulated from global risks, for Q3FY23, the economy is projected to grow at a slower pace of 4.6 per cent against a growth of 6.3 per cent in Q2FY23, with major respite offered by the services sector (festive surge and hospitality sector has lifted growth).

Also read: SBI pegs India’s Q3 GDP growth at 4.6 per cent

Prabhakar said growth in Q3 has largely been uneven across sectors with few of them registering better growth than others, adding that agriculture growth is expected to improve by 3.5 per cent.

She added that while commodity prices have now cooled off from their all-time high seen in Q1FY23, input cost pressure continues to impinge on profits of firms, the impact of which was reflected in the corporate results of industries such as textiles, refineries, chemicals, metal and even plastic.

“On the other hand, construction sector is expected to grow at a solid pace on the back of the improvement in steel and cement output. This is further supported by steady demand push led by housing. Moreover, buoyancy by infra/construction and capital goods output bodes well for this sector,” Prabhakar said.

RBI has pegged Q3 growth at 4.4 per cent and Q4 growth at 4.2 per cent.

For FY23, the economy is poised to grow by 6.8 per cent compared with 8.7 per cent in FY22, she added. The World Bank has pegged FY23 growth for the Indian economy at 6.9 per cent whereas IMF expects growth of 6.8 per cent- same as the RBI.

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