Indian economy surpasses pre-COVID level, set to achieve double-digit growth

India's economy is projected to grow 6.5-7 per cent (growth) next year and thereafter 7 per cent plus over different scenarios. 

New Delhi: India is set to achieve double-digit growth this year, Chief Economic Adviser K. V. Subramanian said on Tuesday (November 30).

"The overall growth for the first half has been 13.7 per cent, so even a little more than 6 per cent growth in the subsequent quarters should be able to deliver double-digit growth for this year," Mr Subramanian said. 

His remarks are significant as it came on a day the data released by the National Statistical Office (NSO) showed that in the quarter (April-June), the economy saw record growth of 20.1 per cent compared with the corresponding period last year.

The central government had to enforce a nationwide lockdown due to the Covid-19 pandemic 2020, and the GDP had contracted 24.4 per cent in April-June 2020. The GDP growth stood at 8.4 per cent in the second quarter of 2021-22, and the economy has surpassed the pre-COVID level.

In value terms, the GDP stood at Rs 35,73,451 crore in July-September 2021-22, higher than the Rs 35,61,530 crore in the corresponding period of the 2019-20 financial year.

"We are projecting 6.5-7 per cent (growth) next year and thereafter 7 per cent plus over different scenarios. I think the impact of seminal second generation reforms will unfold in terms of both investment and in productivity going forward," said Subramanian, whose three-year stint would end next month.

The Economic Survey 2020-21, released in January this year, had projected GDP growth of 11 per cent during the current financial year ending March 2022. But this was before the second wave of Coronavirus attack when the country was again forced to impose lockdowns and restrictions at various state levels.

The NSO data gave some good news that the 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 of 1.5 per cent last year. 

Farm sector GVA growth was up at 4.5 per cent, compared to 3 per cent growth earlier, and the Construction sector GVA grew by 7.5 per cent compared to regrowth of 7.2 per cent earlier. The Mining sector also grew by 15.4 per cent, as against a contraction of 6.5 per cent.