Indian economy's performance better than headline numbers: Sanjeev Sanyal
NEW DELHI : New Delhi: India's economic performance is better than what the headline numbers reveal, with the sharp GDP growth coming amid challenging global macroeconomic conditions, Sanjeev Sanyal, member of Prime Minister Narendra Modi’s Economic Advisory Council, told Mint in an interview. India's higher-than-expected growth of 8.4% during the third quarter of fiscal 2023-24 came without accompanying macroeconomic stresses, he added. Edited excerpts: The latest reading of an 8%-plus growth rate exceeds even the government's expectations.
It is driven by many factors. An important one is investment, both by the government and increasingly by the private sector. It is important to note here that this growth performance has happened despite a very difficult external environment for exports.
In that sense, we are not getting the benefit of external demand. Also, note that this growth performance has not been accompanied by macroeconomic stresses. Inflation is well-behaved; the banking system is clean and profitable; external accounts and foreign exchange reserves are in good shape.
Unfortunately, the external environment continues to be very challenging. Many of our major export markets like Germany, Japan and the United Kingdom are in recession. Monetary conditions are still tight globally although there are indications that the US Fed will (ease interest rates) later.
Thus, given the overall environment, our growth performance is even better than what the headline numbers suggest. Several levers are driving the growth. Investment and construction activities are doing well.
Manufacturing growth is good. Most segments of the services sector are also growing very strongly. There are many drivers of growth.
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