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Robust 4Q23 GDP growth figures to carry momentum into 1H24 for Indian economy
Organization of Petroleum Exporting Countries or OPEC stated in a latest monthly update that the latest data for India shows stronger-than-anticipated 4Q23 growth of 8.4%, y-o-y. The 2Q23 and 3Q23 quarterly growth figures stand at 8.2% and 8.1%, y-o-y, respectively. This places India's annual growth rate in 2023 at 7.7%, y-o-y, up from a previously estimated 6.8%, y-o-y. The strong 4Q23 growth is attributed to sustained strong fiscal policy spending aligned with the government's Production Linked Incentive (PLI) schemes, focusing on 14 key economic sectors, most notably technology and pharmaceuticals. A weak monsoon season leading to unusually dry weather elevated food price inflation in 4Q23, and the agriculture sector registered subdued growth on an annual basis. On a quarterly basis, the agricultural sector declined in 4Q23 by 0.8%, y-o-y.