Indian 3.1 trillion economies might hit roadblocks in the third wave

Last updated on January 10th, 2022 at 04:12 am

India’s economy is going to rise to the occasion, despite the Covid-19 induced hiccups and roadblocks. There is nothing but the agriculture sector to be thanked for this, yet again. India’s economy is expected to grow 9.2% in the current fiscal year.

One can also attribute this growth to the strengthening recovery in the manufacturing, construction, and services sector as well. But economists feel that the third wave might slow down the process as well. According to the World Bank, India’s GPD in current dollar terms had risen to $2.9 trillion in 2019 before falling to $2.7 trillion in 2020 due to Covid’s impact.

However, it is being estimated that this growth rate will helpf in a quick recovery as well. It will help India ‘retain’ its fastest-growing major economy tag in the world. The economy has recovered after the bruising impact of the strictest lockdown imposed to prevent the spread of the coronavirus led to a record 24.4% contraction in the June quarter of 2020-21.

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Owing to its size and proportions, the economy has sustained a massive one billion inoculation drive marking a milestone on August 14, 2021. The National Statistics Office’s (NSO) GDP estimates are marginally lower than the Reserve Bank of India (RBI) which had projected the economy to grow by 9.5%. The International Monetary Fund (IMF) also expects it to expand on similar lines.

However, the NSO recommendations do miss a few uncertainties that mark the growth process for India. In its official statement, it has mentioned that “These are early projections for 2021-22. Actual performance of various indicators, actual tax collections and expenditure incurred on subsidies in the following months, fresh relief measures for the vulnerable sections (such as providing free food grains which have now been extended till March 2022), and other measures, if any, taken by the government to contain the spread of Covid-19 would have a bearing on subsequent revisions of these estimates.”