India's economy grew by 6.3% YOY in Q3 driven by strong domestic consumption and investment

India’s economy is likely to grow by 6.5% YOY in 2022 before slowing to 5.7% YOY in 2023

With the latest GDP print, India has solidified its position as a global bright spot in 2022 and 2023. As firms finalize budgets for 2023, those with an existing presence in India should make the case for resources and expansion in the market. B2C firms should note that strong consumer demand after the pandemic will be bolstered by sanguine inflation numbers and improved confidence. B2B firms should capitalize on the optimistic investment numbers in recent GDP readings along with investment-friendly government policies.


India’s Q3 GDP print came in at a robust 6.3% YOY. Consumption and investment drove a large part of the strong growth number, growing by close to 10% YOY and 6% YOY respectively. From a sectoral perspective, services—including trade, transport, and professional services—displayed particularly high growth. 

Our View

The Q3 GDP number represents a 4% growth over the previous quarter despite the full effects of the Russia-Ukraine war, inflation, and a global growth slowdown coming into effect. Growth continues to partially be driven by pent-up demand, displayed by the strong growth in consumption. However, domestic fundamentals, such as robust investment, continue to be a major driver as well. Firms should note that as we approach 2023, the impact of pent-up demand will wane and the global growth slowdown will weigh on India’s outlook. As a result, we expect slower growth at close to 5.7% YOY in 2023 compared to 6.5% YOY in 2022; however, India is likely to be one of Asia’s and the world’s fastest-growing markets this year and next.

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