NEW DELHI: India’s economy grew by 20.1 percent in the first quarter (1 Apr – 30 Jun) of FY22 (the Fiscal Year 2021 – 22), reaching 32.38 lakh crore, down from Rs. 35.66 crore in the same period of the previous financial year. During the statewide shutdown in April-June last year, the GDP shrank to Rs. 26.95 crore.
However, this statistic should not be confused with a strong recovery due to the low base effect. According to figures provided by the National Statistical Office (NSO) on Tuesday, the Gross Domestic Product (GDP) decreased by 24.4 percent in the second quarter (1 Jul – 30 Sep) of 2020-21.
In the first quarter, the country’s real gross value added increased by 18.8%. Construction grew by 68.3 percent, making it a significant contributor to the total. Trade, hotels, transportation, and communication services, on the other hand, expanded by 34.3 percent.
In the fourth quarter (1 Jan – 31 Mar) of FY21, India’s GDP increased by 1.6%. There was a slight increase in inactivity after the pandemic’s initial impact faded. In the fiscal year 2020-21, however, GDP dropped by 7.3 percent.
Following the first-quarter hiccup caused by the second wave’s impact, the economy has begun to show indications of recovery. The government and the RBI have taken steps to facilitate the recovery process. Last year, the pandemic had negative impacts on economic activity. Unlike the previous year’s nationwide lockdown, repeat state-level lockdowns had a minor effect on the economy since they gave customers more flexibility to spend. The RBI (Reserve Bank of India) predicted a growth rate of 21.4 percent for this quarter.
The RBI governor, Shaktikanta Das, underlined the lenient approach that the RBI has pursued to encourage GDP development during the last Monetary Policy Committee review. The Reserve Bank of India (RBI) has decreased the country’s growth forecast for the current fiscal year to 9.5 percent from 10.5 percent previously, while the World Bank predicts 8.3 percent growth in 2021.
As the number of vaccinations increases and the number of cases drops, economic activity will undoubtedly rise, as will consumer demand. India’s economy is gradually but steadily improving.