The country’s gross domestic product (GDP) is likely to grow by more than 9.5% in the 2021-22 financial year, a research report by SBI-Ecowrap said. The economy grew at 8.4% in the second quarter of the current fiscal, according to data released by the National Statistics Office (NSO) on Tuesday. Growth in the April-June quarter of this financial year stood at 20.1%.
In its October monetary policy review, the Reserve Bank of India left its forecast for real GDP growth unchanged at 9.5% for 2021-22, including 7.9% in Q2; 6.8% in Q3; and 6.1% in the fourth quarter of 2021-22.
“We believe real GDP growth will be higher than the RBI estimate of 9.5%, assuming that the RBI growth numbers for Q3 and Q4 are sacrosanct,” the research report said. research report said. It added that real GDP growth could be closer to 10%.
The report said GDP grew by 8.4% in the second quarter of 22 due to double-digit growth in mining and quarrying, public administration, defense and other services. Real GVA increased by 8.5%, slightly above GDP growth.
During the first half of Fiscal Year 21, the country showed a real GDP loss of Rs 11.4 lakh (year-on-year) due to the complete shutdown in April-May and partial closure in June. -September, it added. The situation improved in FY22, and in the first half of FY22, the actual increase was around Rs 8.2 lakh.
“This suggests that the actual loss of Rs 3,2 lakh still needs to be offset to reach pre-pandemic levels,” the report said. Industry data indicates that commerce, hospitality, transport, communications and broadcasting-related services remain the most affected and the actual loss of Rs 2.6 lakh still needs to be covered. offset in these areas.
Overall, the economy is still operating at 95.6% of pre-pandemic levels (with trade, hospitality, transportation, communications and broadcasting-related services remaining at 80%). ) and needed another quarter to cover the damage.
In the second quarter of FY22, the FMCG sector reported year-on-year growth of 11%, while EBIDTA (earnings before interest, taxes, depreciation and amortization) and NPAT increased 4% each. . However, the rural market, which has shown good resilience so far during the pandemic, has slowed in the past few months as suggested by several industry majors, according to the report.
The research report says new investment announcements for the current year look encouraging, with around Rs 8.6 lakh crore investment announcements made so far in the last seven months of FY22.
With the private sector contributing about 67% of this, which is Rs 5.80 lakh crore, it looks like a resurgence in private investment is approaching, it added.