Indian economic growth may touch 10.1% in 2021-22, suggests NCAER report
The Indian economy is likely to grow 8.4-10.1% for the current financial year as against a contraction of 7.3% in the last fiscal, the economic think-tank National Council of Applied Economic Research (NCAER) said on Friday.
The research council has pitched for strong fiscal support to push India's economic growth in its quarter review report, reported news agency PTI.
"We estimate that gross domestic product (GDP) will grow 11.5% in Q1 (first quarter) and 8.4-10.1% for the whole year 2021–22," the think-tank said.
The Indian economy turned a corner this month and began regaining momentum in June, ultra-high frequency data indicate, though subdued consumer sentiment is expected to limit the pace of recovery in Asia’s third largest economy. This comes as states gradually ease curbs on business activity, keeping in mind the decline in the number of fresh Covid cases.
The week ended June 13 was at least the third consecutive week in which economic activity sequentially gained momentum, according to three data trackers by research agencies using a range of data available on daily or weekly basis.
Indicating that the economy will reach the level where it was in 2019 after suffering two brute Covid-19 waves. "However, these high growth rates are also a reflection of strong base effects since 2021-22:Q1 follows the very steep decline in 2020-21:Q1. At the end of 2021-22 GDP, on constant prices, would still be about the same as ₹146 trillion ( ₹146 lakh crore) as in 2019-20," the NCAER said in a statement.
In 2020-21, India's economic growth slowed and contracted by 7.3%, the NCAER said.
The second wave of Covid-19 in India was four times worse than the first wave in terms of infections and deaths seen in the country, the report said. The second wave disrupted the already battered growth process from the first wave, it added.
The economic activity, according to the think-tank's report, declined sharply at the peak of the second Covid-19 wave in April and May this year as shown by the high-frequency indicators.
Economically, in June, India will see activities pick up signalling recovery during the gradual unlocking process.
The NCAER report has stressed on a strong positive push to restore the growth process after the Covid-19 waves India has seen.
This, combined with a strong expansionary macroeconomic policy thrust, could help revive normal growth, the report said.