Editor's Letter: Year of Recovery
'Learn from yesterday, live for today, hope for tomorrow. The important thing is not to stop questioning.' —Albert Einstein
The morning, they say, shows the day. If the last two quarters of the 2022 financial year are any indication of what 2023 portends to be, let us assume that it will be a ‘year of recovery, growth and recalibration’. The World Bank expects India's real GDP to grow at 6.9 per cent in the 2022-2023 financial year, revising upwards its previous projection of 6.5 per cent. The International Monetary Fund (IMF) to sees India doing relatively well amidst a despondent global scenario, in which growth is expected to slow down to 2.7 per cent. In a recent report the IMF has forewarned that “The worst is yet to come, and for many people, 2023 will feel like a recession.”
In India, the government’s earnings have increased consistently from the Railways and direct tax collections. India’s foreign exchange reserves crossed $550 billion recently. India’s overall exports (merchandise and services combined) during April-November 2022 showed a positive growth of 17.72 per cent over the same period last year. This trend is expected to roll over into 2023 as well. So, how is India tackling the economic challenges of the day? It is doing so by increasing public spending and by monitoring and taking measures to tame inflation.
In her last budget, Union Finance Minister Nirmala Sitharaman had raised capital expenditure by 35 per cent for the ongoing fiscal to Rs 7.5 lakh crore. This trend is expected to continue in her fifth budget, expected to be announced in a month's time. The Finance Minister has hinted as much in a recent interaction with industry representatives. Increased public spending, particularly in infrastructure creation, is already paying dividends. More than a dozen expressways became operational in 2022. Another 30 new expressways and highways are expected to start operations in 2023. The work on the dedicated freight corridor, the Delhi-Mumbai expressway, is inching towards completion, while construction activities in both housing and commercial projects, have shown a significant uptick.
In this issue we shine the spotlight on some key sectors that capture trends likely to be continue in 2023. With each passing week more cities and towns are witnessing the rollout of 5G services, which will improve connectivity well into 2023. The automotive sector is at last showing signs of recovery, after being down in the dumps for two years. Car sales are expected to cross 3.88 million units in 2022, crossing the previous benchmark of 3.33 million units in 2018. The two-wheeler segment and farm vehicles, though are still some distance away from bouncing back. The FMCG sector, that reveals consumer spending across social strata, showed large volume growth in the second quarter. These trends, expected to continue well into 2023, have been captured in our special reports, columns and expert opinions. We hope you enjoy reading this issue, as much as we did in putting it together.
Have a happy new year!
