India’s real GDP growth will slow from 8.3% in 2021 to 7.7% in 2022 and will decelerate further to 5.2% in 2023, Moody’s Investor Service said in a report on Thursday. Rising interest rates, uneven distribution of monsoons, and slowing global growth will dampen economic momentum on a sequential basis, it said.However, Moody’s has argued that India’s economic growth would be stronger than its projections in 2023 if the private-sector capex cycle were to gain steam. “India’s economic growth before the COVID-19 shock had materially slowed because of the impact of corporate-sector deleveraging on business investment. With the deleveraging complete, corporate-sector investment is showing early signs of a pickup, which could provide support to a continued business cycle expansion through several quarters, supported by investment-friendly government policies and the rapid digitization of the economy,” it said in a report. Data released by the government on Wednesday showed that India’s gross domestic product (GDP) grew 13.5% in the first quarter of the current financial year (April-June) as compared to 4.1 per cent in the previous quarter on the back of a favourable base. Though the Q1 growth was lower than the Reserve Bank of India’s estimate of 16.2 per cent for the first quarter of 2022-23, it was the sharpest growth in the Indian economy in a year.93918099High-frequency indicators are showing strong and broad-based underlying momentum in the first four months of the ongoing fiscal. Services and manufacturing sectors have seen robust upswings in economic activity, according to hard and survey data, such as PMI, capacity utilization, mobility, tax filing and collection, business earnings and credit indicators. “However, inflation remains a challenge with the RBI having to balance growth and inflation, while also containing the impact of imported inflation from the year-to-date depreciation of the Indian rupee against the US dollar of around 7%,” Moody’s said.It is expected that inflationary pressures in India will weaken in the second half of this year and further next year.