India’s gross domestic product (GDP) is forecast at 9.2 per cent in FY22, according to advance estimates by the National Statistical Office (NSO) on Friday. This keep India on track to regain its position as the world's fastest-major economy.
As per the first advanced estimates of the national income released by the National Statistical Office (NSO) on Friday, growth is witnessed across sectors.
"Real GDP or GDP (gross domestic product) at Constant Prices (2011-12) in the year 2021-22 is estimated at Rs 147.54 lakh crore, as against the Provisional Estimate of GDP for the year 2020-21 of Rs 135.13 lakh crore, released on May 31, 2021. The growth in real GDP during 2021-22 is estimated at 9.2 per cent as compared to the contraction of 7.3 per cent in 2020-21," as per the NSO statement.
The economy had contracted by 7.3 per cent in the previous financial year.
As per the estimates, GDP in actual terms in 2021-22 will surpass the pre-Covid level of Rs 145.69 lakh crore in 2019-20.
This growth is lower than the 9.5 per cent figure estimated by the Reserve Bank of India’s monetary policy committee last month, but it is higher than the World Bank’s estiamte of 8.3 per cent. The projection is less than the 9.5 per cent forecast by the International Monetary Fund (IMF) and S&P, while Moody's Investors Service had in recent weeks put India's growth forecast at 9.3 per cent. Fitch Ratings had cut its GDP forecast for FY22 to 8.4 per cent in December, estimating that GDP growth momentum would peak in FY23.
Nominal GDP, which is used as the base for FY22's revised estimated, is seen growing at 17.6 per cent against the 14.4 per cent growth used during the budget estimates for FY22. Gross Value Added (GVA) is seen rising by 8.6 per cent in FY22, compared to a contraction of 6.2 per cent in FY21.
With one quarter still left in the fiscal year, there has been a surge in daily COVID-19 cases in recent days driven by the Omicron variant which is set to overtake Delta as the dominant strain. This has prompted fresh restrictions in several parts of the country, threatening the fragile economic recovery.
Risks to the economy stem from an Omicron-led third wave which may upend growth revival across sectors, specially the contact-intensive services industries.
With 9.2 per cent growth in 2021-22 fiscal, the economy will surpass the pre-COVID level in actual terms, mainly on account of improved performance by farm, mining and manufacturing sectors.
"Real GDP or GDP (gross domestic product) at Constant Prices (2011-12) in the year 2021-22 is estimated at Rs 147.54 lakh crore, as against the Provisional Estimate of GDP for the year 2020-21 of Rs 135.13 lakh crore, released on May 31, 2021.
"The growth in real GDP during 2021-22 is estimated at 9.2 per cent as compared to the contraction of 7.3 per cent in 2020-21," as per a statement by the NSO.
India's GDP growth is higher than China's
The finance ministry's Economic Survey in February last year had projected an 11 per cent growth rate for 2021-22. The growth estimate for India is higher than 8 per cent projected for China. As per NSO estimates, GDP in actual terms in 2021-22 will surpass the pre-COVID level of Rs 145.69 lakh crore in 2019-20.
The pandemic hit the country in March 2020, resulting in a nationwide lockdown from March 25, 2020, which severely dented the economic growth in the 2020-21 fiscal.
According to the statement, real GVA (gross value added) at Basic Prices is estimated at Rs 135.22 lakh crore in 2021-22, as against Rs 124.53 lakh crore in 2020-21, showing a growth of 8.6 per cent.
In the current fiscal, the manufacturing sector is likely to see a growth of 12.5 per cent against a contraction of 7.2 per cent a year ago.
The NSO estimates significant growth in 'mining and quarrying' (14.3 per cent), and 'trade, hotels, transport, communication and services related to broadcasting' (11.9 per cent).
The agriculture sector is estimated to see a growth of 3.9 per cent in FY2021-22, higher than the 3.6 per cent expansion recorded in the previous financial year.
Morgan Stanley in a January 4 report had said India's growth trend has faced various exogenous shocks in the last eight years, leading to a weaker than expected growth trend, especially as measured by corporate revenue growth.
"Policymakers have erred on the side of creating macro stability buffers with price stability and external stability risks contained," it had said. "We remain optimistic of cyclical recovery to continue in coming quarters with all drivers of growth firing, leading to a capex led growth cycle."
Over the medium term, India will likely to be one of the few countries to offer high productive growth, it had said.
With inputs from PTI
