India growing faster than official data shows, says Credit Suisse

Mishra said the growth in dense fuels — which is typically below the real GDP growth as fuel efficiencies go up — is over 4 percent per annum for the last three years.

Similarly, revenue growths of the BSE500 companies also point out to a faster growth, he said.

"We are expecting a stronger acceleration in India’s GDP growth in 2023 owing to several domestic growth drivers. Revival in government spending, increase in low-income jobs and easing of supply-chain bottlenecks should partly offset the impact of rate hikes, a slowing global economy and the need to reduce the balance-of-payments (BoP) deficit," he said.

The risk factors continue to be dependent on imported energy, reliance on foreign capital and a slowing global economy, he said.

The present inflation situation and outlook does not necessitate more rate hikes, but the RBI may hike purely to thwart any damage on the balance of payments front, he said.

From a markets perspective, he sounded more sanguine about domestic flows.

Mishra said it is a misnomer that China’s difficulties are resulting in higher inflows into India, and added that the flows are driven more by region-based allocations by managers like Asia Pacific and Emerging Markets.

Therefore, it would help increase portfolio flows into India if China’s lockdowns end, he told reporters.

The brokerage is overweight on the financial sector and feels the current high growth in credit will not lead to a spike in non performing assets.

It is underweight on the information technology and the industrials sectors, Mishra said.