This will be the fastest expansion since 1988-89, when the economy expanded by 9.6% and comes on the back of a 7.3% contraction during the previous financial year when growth fell due to the impact of the Covid-19 pandemic. This would also be the fastest growth under the new methodology, for which 17 years of data are available. The data showed that almost all sectors except ‘trade, hotels, transport, communication and broadcasting services’ have reached pre-pandemic levels.
This projected growth rate will also help India retain its fastest growing major economy tag. The economy has recovered due to a 24.4% contraction during April-June 2020 due to the strict nationwide lockdown imposed to contain the spread of coronavirus.
Nominal GDP growth inclusive of inflation is estimated at 17.6% as per the Advance Estimates released by National Statistics Office ,NSO) on Friday. According to SBI research, this is the second highest nominal growth since 2010-11 at 19.9% and 17.1% in 2006-07. The size of the economy is estimated at $3.1 trillion based on current prices in dollar terms.
NSO’s GDP marginally lower than expected reserve Bank of India(RBI) launch. The central bank had forecast the economy to grow at 9.5% International Monetary Fund (IMF) also expects its expansion along the same lines. The government had budgeted for double-digit growth rate during the current financial year.
but led by the third wave omicron The variant casts a shadow on the power of growth and recovery. Many economists have lowered their growth projections for the full year and expect restrictions being imposed by states to impact businesses and overall growth. The NSO also cautioned that the 9.2% GDP growth forecast in the first advance estimates does not take into account several factors and may result in revisions due to the impact of government measures.
“However, these are preliminary estimates for 2021-22. Actual performance of various indicators, actual tax collection and expenditure on subsidies in subsequent months, new relief measures for weaker sections (such as providing free food grains which have now been extended till March 2022) and other measures, if any , taken by the government to contain the spread of COVID-19, will preclude subsequent revision of these estimates,” the NSO said. The Indian economy has staged a sharp recovery after the second wave and several indicators had reached their pre-pandemic levels aided by measures taken by the government and the RBI.
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