Indian GDP (Gross Domestic Product) grew by 8.4 per cent in the second quarter of the current financial year, according to the data released by the government on November 30. The ministry of statistics and programme implementation released the estimates of GDP both at constant and current prices. The data showed that the economy has surpassed the pre-Covid level.
“GDP at Constant (2011-12) Prices in Q2 2021-22 is estimated at ₹35.73 lakh crore, as against ₹32.97 lakh crore in Q2 2020-21, showing a growth of 8.4 per cent as compared to 7.4 per cent contraction in Q2 2020-21,” the ministry said.
At current prices, the Indian GDP is estimated at ₹55.54 lakh crore, as against ₹47.26 lakh crore in Q2 2020-21, showing a growth of 17.5 per cent as compared to 4.4 per cent contraction in the same period last year, the ministry added.
The Indian economy had shrunk in 2020-21 fiscal (April 2020 to March 2021) as the coronavirus disease (Covid-19) pandemic induced restrictions battered business activity. The gradual lifting of the restrictions and fiscal and monetary measures and ₹20 lakh crore stimulus package, have helped the economy to rebound from pandemic lows.
“Indian GDP at Constant (2011-12) Prices in April-September 2021-22 (H1 2021-22) is estimated at ₹68.11 lakh crore as against ₹59.92 lakh crores during the corresponding period of previous year, showing a growth of 13.7 per cent in H1 2021-22 as against contraction of 15.9 per cent during the same period last year,” the ministry said in a release.
According to the government data, gross value added (GVA) growth in the manufacturing sector accelerated to 5.5 per cent in the second quarter of 2021-22, compared to a contraction 1.5 per cent a year ago.
Providing a sector-wise break-up of the growth, the data from National Statistical Office (NSO) said that electricity, gas, water supply and other utility services segment posted growth of 8.9 per cent against 2.3 per cent expansion a year ago, while trade, hotel, transport and communication grew by 8.2 per cent compared to 16.1 per cent contraction earlier.
Financial, real estate and professional services growth stood at 7.8 per cent in the quarter for which the data has been released, compared to a contraction of 9.1 per cent. Similarly, defence and other services grew at 17.4 per cent during the September quarter, compared to 9.2 per cent contraction a year earlier.
Recent high-frequency indicators such as the October services purchasing managers’ index reading of 58.4 had suggested that a strong recovery is underway.
Suvodeep Rakshit, Senior Economist at Kotak Institutional Equities, said the growth should remain “fairly well supported in Q3 FY22 too on account of festive season and opening up of services sector too.”
“Growth remains well on track for a full year growth of around 9.5 percent. The growth numbers will unlikely play a differentiating factor for the RBI’s policy with its own estimate being at 7.9 percent. With a new Covid variant starting to spread globally and uncertainty on its impact on the economic scenario, the RBI would possibly wait for some more clarity before moving decisively on the rates. We maintain our call for a reverse repo rate hike in February with the December meeting remaining a close call,” Rakshit added.