India To Emerge As Asia’s Strongest Economy Next Year: Report
New Delhi: An American multinational investment management and financial services company, Morgan Stanley has predicted the growth rate of India for the next year. The company said, “India could emerge as Asia’s strongest economy in 2022-2023 on the back of robust domestic demand aided by economic policy reforms, a young workforce, and business investments.”
According to the media report, The brokerage has estimated India’s growth to average 7 percent for 2022-2023 and contribute 28 percent and 22 percent to Asian and global growth, respectively.
The company in its report noted that India now expects GDP growth of 8-8.5 percent for 2022-2023. The projection comes amid India’s economic growth of 9.2 percent in the fiscal year 2022, a sharp recovery from a 6.6 percent contraction in the previous year as Covid-19 lockdowns severely impacted the economic growth.
On economic growth, the experts have said, “India had slashed corporate tax rates in 2019 and also launched the PLI scheme in 2020 to boost domestic manufacturing and attract manufacturers and revive private investment,”
Morgan Stanley’s outlook comes at a time when developed economies painted a gloomy picture with business activity in the United States and eurozone contracting in July, as per their PMI data.
It noted that India, like other economies, spiked interest rates to tackle inflation, and the 39.45 trillion rupees ($529.7 billion) budget for the current fiscal year is aimed to push public investment. It expects domestic consumption to pick up and services exports to hold up better than goods exports.
“Lower corporate taxes, the production-linked incentive (PLI) scheme, and India as a potential beneficiary of supply chain diversification will catalyze and sustain domestic demand, especially in investment,” the economists said in a note dated Tuesday.
(Vinayak)
