ICRA expects Indian GDP to grow by 12-13% in Q1-FY23

ICRA predicted that the economy will grow 12–13% in the first quarter of the new fiscal year, citing the second-highest reading of the business activity index in 13 months in April.

Rating agency ICRA (Investment and Credit Rating Agency of India Limited) predicted that the Indian economy will grow 12–13% in the first quarter (Q1) of the new fiscal year, i.e. FY23. ICRA gave this rating citing the second-highest reading of the business activity index in 13 months in April. However, ICRA has kept its annual GDP prediction at 7.2% for this fiscal year, citing concerns over inflation and the ensuing tightening of RBI policy.

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ICRA Predict Economic Growth: Key Points

Particularly on an annualised basis, this rapid growth may continue into May, which should result in a double-digit GDP growth of 12–13% in the first quarter according to ICRA.
According to Aditi Nayar (ICRA) this might not continue, and the annual expansion in volume and activity would slow. She claims that increasing input costs could cause GVA growth to slow to single digits.
Aditi Nayar (ICRA) stated that the consumer price index is anticipated to average between 6.3 and 6.5 percent this fiscal, citing growing inflation concerns.
The impact of the war in Ukraine and the skyrocketing cost of fuel present the greatest upside risks to inflation and growth. The damage will be far greater than expected if the war does not deescalate soon.
This is also the main justification for keeping the full-year GDP growth forecast low at 7.2% and the one on a low base effect higher at 3%.
On the subject of interest rates, Nayar stated that the central bank will likely increase rates by 25 basis points each in the policy reviews in June and August, and that the decision to take action in September will depend on the course of the war and how it affects commodity prices.

ICRA: About

ICRA Limited (ICRA) is a credit rating and independent investment information company based in India. Initially known as Investment Information and Credit Rating Agency of India Limited, the business was founded in 1991. (IICRA India). Moody’s and several Indian commercial banks and financial services providers collaborated on it. On April 13, 2007, the business went public and changed its name to ICRA Limited. It listed on the Bombay Stock Exchange and the National Stock Exchange. Moody’s Corporation holds a 51.86% majority share as of the end of December 2020.