MUMBAI: Based on the wider and more granular data on economic activities from the new 2023 base year for GDP, the State Bank has projected that the December quarter growth may print in at 8.1%, the highest forecast so far by any economist.
The official GDP data with the new base year will be released this Friday. The economy has grown 8% in the first half of the fiscal with Q1 printing in at 7.8% and the Q2 surprising on the upside with an 8.2% clip.
“We see Q3 real GDP growth at be at 8.1%, but given significant methodological changes and new data series to be released it is difficult to predict the extent of revision,” Soumya Kanti Ghosh, the group chief economic adviser to State Bank of India, said in a report Tuesday.
“High-frequency activity data indicates resilient economic activity in Q3. Rural consumption remains strong, driven by positive signals from farm and non-farm activity. Supported by fiscal stimulus, urban consumption shows a consistent uptick since the last festive season,” Ghosh added.
The report further said despite global headwinds, the economy has maintained strong growth momentum. According to the first advance estimate, GDP is estimated to grow at 7.4% in FY26, with growth largely driven by domestic demand while the economic survey pegged potential growth to be around 7% and estimated to grow in the range of 6.8-7.2% during FY27.
Since the second advance estimates for FY26, incorporating additional, new data and revisions with base year of fiscal 2023 from fiscal 2012, are scheduled for Friday, all quarterly numbers of Q1 and Q2 are also expected to change, he said.
On the base year revision, he said the move is expected to provide better estimates. This revision, along with an updated CPI with base year of 2024, will better reflect the current economic structure, including increased digital commerce and service. The overhaul includes better measurement of the informal sector and new data sources like GST, potentially placing the country as the world's fourth-largest economy.
The new series will incorporate more granular data, including GST records, vehicle registrations, and information on natural gas consumption apart from offering improved measurement of the informal economy using quarterly data, he said.