India poised to sustain growth momentum, but no time to rest on laurels: Fin Min report

economictimes.indiatimes.com:

Finance Ministry said in its annual review report on Thursday. "India appears poised to sustain its growth in a more durable way than before. Nonetheless, it is no time to rest on laurels nor risk diluting the painstakingly and consciously achieved economic stability.

If we are patient, the rising tide will lift all boats as it has begun to," it said. That said, external factors like escalation of geopolitical stress, enhanced volatility in global financial systems, sharp price correction in global stock markets, El Nino, and modest trade activity and FDI inflows are likely to constrain India’s pace of economic growth in the ongoing fiscal, it added. The ministry notes that external demand worked in favour of Indian economy until Q1FY23, after which it fell as central banks across the globe began their monetary tightening process to curb rampant inflation.

This in effect impacted merchandise exports. India also benefited from decline in global commodity prices, the ministry noted, as it reduced the cost of the country’s imports which remained high throughout FY23. On what is working for India’s economy, the ministry said that it sees strength in the country’s domestic demand.

The ministry said that the Indian economy has carried the momentum from FY23 into the current fiscal year. India's rural demand is on the path to recovery. FMCG volume sales in rural areas turned positive in the last quarter of the previous fiscal, signalling a turnaround in rural demand scenario, data shows.