Mumbai: With decrease in the number of fresh Covid-19 According to credit rating agency Icra Ratings, the country’s gross domestic product (GDP) will grow by 8.5 percent in FY2021-22, easing restrictions. It expects gross value added (GVA) at basic prices (at constant prices for 2011-12) to grow by 7.3 percent in FY2022.
‘The impact of the second wave of Covid-19 and the subsequent government restrictions were seen in a range of high-frequency indicators in April-May 2021. Now that the new cases have been moderated and restrictions eased, we have set our GDP growth expectation for FY2022 at 8.5 percent, ”ICRA said. chief economist, Aditi Nayar, said. Icra said if vaccine coverage is accelerated following the re-centralized procurement policy, the GDP expansion in FY2022 could be as high as 9.5 percent, with an increasing rise in Q3 and Q4 of FY2022.
In FY2020-21, the country’s GDP shrank by 7.3 percent. Last week, the Reserve Bank of India (RBI) forecast real GDP growth in 2021-22 at 9.5 percent. For the full year, he expects GDP growth to exceed GDP growth by 120 basis points (bps), based on expectations related to the value of product taxes and subsidies on products in FY2022.
This took into account the likely higher output of food subsidies by the government in FY2022, relative to the budgeted level, following the decision to supply free food grains in May-November 2021. The agency ruled out the impact of the food subsidy release. overdue in FY2021, based on the information provided by the National Statistics Office (NSO).
The monthly pattern of government subsidy release cannot be determined at present, Nayar said, adding: ‘Therefore, we warn that the quarterly trend in GDP growth may differ from our assumption as a basis (+14.9 percent in Q1, +8 percent in Q2, +5.6 percent in Q3 and +7 percent in Q4 of FY2022), based on when discussing the subsidy payout. The rating agency expects a long-term negative effect of the second wave on consumer sentiment and demand, with healthcare and fuel expenditures reducing disposable income, and less pent-up / replacement demand in FY2022 compared to FY2021.
Source: Telangana Today