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India's growth need to remain steady between 8-10% to reverse pandemic effect

In the last policy review, the RBI retained the GDP growth of 10.5 percent for the fiscal year 2022 and said global growth is gradually recovering from slowdown but remains uncertain.

July 30, 2021 / 01:13 PM IST
For fiscal year 2022-23, however, IMF expects economic growth of 8.5 per cent, larger than the 6.9 per cent it had projected in April.

For fiscal year 2022-23, however, IMF expects economic growth of 8.5 per cent, larger than the 6.9 per cent it had projected in April.

India’s growth trajectory should ideally remain between 8-10 percent growth to reach pre-pandemic levels, The Times of India (TOI) reported, citing experts.

Chief Economic Adviser Krishnamurthy Subramanian told the publication that the GDP growth rate in the current fiscal year would not “be very much off compared to the estimate of 10.5% growth”.

In the last policy review, the Reserve Bank of India (RBI) retained the GDP growth of 10.5 percent for the fiscal year 2022 and said global growth is gradually recovering from slowdown but remains uncertain.

The RBI said the projection of real GDP growth for 2021-22 consists of 26.2 percent in Q1, 8.3 percent in Q2, 5.4 percent in Q3 and 6.2 percent in Q4.

Meanwhile, the International Monetary Fund (IMF), on July 27, cut India's gross domestic product (GDP) growth forecast to 9.5 percent for fiscal year 2021-22, from the previous forecast of 12.5 percent, citing the hit on economic activity and demand due to the deadly 'second wave' of the COVID-19 pandemic.

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The report said that steady recovery was not assured anywhere so long as segments of the population remained susceptible to the virus and its mutations.

"Recovery has been set back severely in countries that experienced renewed waves— notably India," it said.

For fiscal year 2022-23, however, the IMF expects economic growth of 8.5 percent, larger than the 6.9 percent it projected in April.

Soumya Kanti Ghosh, group chief economic adviser at SBI stressed that India will recoup the FY21 GDP losses but raised the question of “what would be the permanent loss in output,” TOI noted.
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first published: Jul 30, 2021 01:13 pm
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