The economic growth of April-June GDP could end up being a record quarterly extension as the economy sees a recovery from the second wave of the pandemic and advantages from the low base of last year.
Statistics office of India will deliver the quarterly GDP information on Tuesday and different assessments show that it could go from 10.5% to 31.6%, while the middle figures of two surveys show it at 20% and 21% in April-June, the main quarter in the 2021-22 financial year. The RBI had assessed the main quarter growth to be 21.4%. To place the numbers in context, the April-June quarter of last year had posted the most narrow contraction on record of 24.4% because of the effect of perhaps the strictest lockdown forced to resist the Covid transmission.
“Essentially we are looking at a very strong double-digit growth of 23% for this quarter and likely higher than RBI’s own assessment. A large part of this is because of a very favourable base from last year, when the nationwide lockdown had almost brought the economy to a standstill,” said an economists at QuantEco Research, Yuvika Singhal.
“But nevertheless I think this double-digit growth is more of optics than anything else because we need to keep in mind that this was also the quarter when the second wave of the pandemic was extremely ferocious and April and May saw a large number of states getting into piecemeal restrictions, which by the end of May had almost become like a nationwide lockdown, though in a very staggered fashion at the state level,” she said.
Financial experts say, growthin the initial quarter would be driven by production, mining and construction areas, while the agri fragment will likewise lend solid assistance. The slouch will be the administrations area, which has been hit hard by the two back to back waves of the pandemic and is yet to recover from the swelling sway. The speed of vaccination, which has built up speed presently, will likewise assume a pivotal part in deciding the direction of growth in the quarters ahead.
“I think it would be a more broad-based story in the second half of the year unlike now where industry is leading the pack compared to services,” said another economist at Emkay Global Financial Services, Madhavi Arora.
