India GDP News LIVE Updates: India likely to show double-digit growth; consumer spending and low base expected to

Better consumer sentiment

The index of consumer sentiments (ICS) improved 10.7% in July 2021 to 53.1 over June 2021, signalling a smart but incomplete bounceback after the second wave of the pandemic pulled it down to 48 in May, said the Centre for Monitoring Indian Economy. However, it was still just half of its level before the Covid-19 induced lockdowns began in March 2020 when it stood at 105.3 in February 2020.

Roots of economic recovery deepen in July

With the easing of COVID-19-related restrictions by the states, the roots of the economic recovery deepened in July 2021, says a report. The unlocking in the country has manifested itself in improving performance across various high-frequency industrial and service sector indicators, mobility, and toll collections in July 2021, according to a report by Icra Ratings.

Significant rebound in formal sector hiring in June

Formal sector hiring rebounded significantly in June, after registering a dip in May, as the second wave of the pandemic ebbed out resulting in an uptick in economic activity.

Ashima Goyal on India’s economic health

Despite the Covid-19 severe shock, India’s macroeconomy is more healthy and ready for faster growth than it has been for a long time. That recovery from both the first and second waves was faster than expected points towards inherent strengths of the economy,” Ashima Goyal said.

We have projected a GVA YoY growth of 20 per cent and a GDP growth of 22-23 per cent for Q1FY22

– Suman Chowdhury, Chief Analytical Officer, Acuite Ratings & Research

Slower recovery pace in August

The Nomura India Business Resumption Index (NIBRI) rose to 102.7 for the week ended August 29 from 101.3 the previous week, Japanese financial holding company Nomura said on Monday. However, the pace of recovery slowed in August as the index was up 5.6 percentage points (pp) after a 17.1 pp rise in July and a 15 pp rise in June.

FDI equity inflows more than double in Q1

Total FDI inflow rose to $22.53 billion during the first quarter of FY22 as against $11.84 billion in the same period last year, the commerce and industry ministry said in a statement. Total FDI comprises equity inflows, reinvested earnings and other capital.

Crash in Tomato prices

Exports from SEZs up 41.5 per cent

Exports from special economic zones (SEZs) grew by about 41.5 per cent to Rs 2.15 lakh crore during the April-June quarter of the current fiscal on account of healthy growth in pharmaceuticals, engineering, and gems and jewellery sectors, as per official data. SEZs are key export hubs which contribute about one-fourth of the country’s total outbound shipments.

India’s business resumption activity

Business resumption activity continued its northward journey and reached a new high, much above the pre-pandemic levels for the week ended August 29, a Japanese brokerage said on Monday. The Nomura India Business Resumption Index rose to 102.7 for the week ending 29 August from 101.3 in the prior week, as per the brokerage.

We expect GDP growth for Q1FY22 at 14 per cent (year-on-year), largely due to a low base in Q1FY21. The subsequent quarters will see an improvement if there is no resurgence of the virus in the form of a third wave

– Brickwork Ratings’ Chief Economic Adviser M.Govinda Rao

A look at first quarter growth projections

SBI on India’s economic growth

India’s economy is likely to have grown 18.5% in the first quarter of FY22, State Bank of India Research said in its latest edition of Ecowrap, attributing the high expansion to the base effect of negative growth in the same quarter last year.

Relaxation in investment norms for InvITs?

According to PTI sources, the finance minister, in the upcoming FSDC meeting, may ask financial sector regulators to relax and harmonise investment norms for instruments like infrastructure investment trusts (InvITs) to be used to monetise public assets like highways, power and railway tracks.

All eyes on FSDC meeting

Finance Minister Nirmala Sitharaman has called a meeting of the Financial Stability and Development Council (FSDC) on September 3 to discuss the state of the financial sector and a strategy to support the nascent recovery of the pandemic-hit economy. This would be the 24th meeting of the FSDC and the first during the current financial year. The last meeting was held on December 15, 2020.

A look at major projections

The Reserve Bank has lowered the country’s growth projection for the current financial year to 9.5 per cent from 10.5 per cent estimated earlier, while the World Bank has projected India’s economy to grow at 8.3 per cent in 2021.

Niti Aayog Vice-Chairman Rajiv Kumar on India’s economic health

A strong economic growth rebound is expected on the back of rapid vaccinations, a recovering monsoon boosting agricultural output, thrust on infrastructure investments by the government, and growth in export, Niti Aayog Vice-Chairman Rajiv Kumar has said.

What’s affecting the animal spirits of the private sector

CII CEOs poll: Responding to the question on what is affecting the animal spirits of the private sector, majority of the CEOs (51 per cent) indicated that Ease of Doing Business was still cumbersome at the grassroots followed by Cost of Doing Business (other than Capital cost) being high, as indicated by 32 per cent of the CEOs.

Significant revival in corporate sector

A significant economic recovery is expected in the corporate sector’s performance during the financial year 2021-22, according to India’s business leaders. The CII CEOs poll was conducted among 117 Senior CEOs at the recent meeting of the CII National Council. Majority of the CEOs polled, about 79 per cent of them expected GDP growth to be more than 8 per cent.

States’ fiscal health

India Ratings and Research (Ind-Ra) expects aggregate fiscal deficit of states to moderate to 4.1 per cent of the gross domestic product (GDP). The agency’s earlier forecast for FY22 was 4.3 per cent. The impact of second Covid wave on the economy notwithstanding, Ind-Ra estimates nominal GDP to grow 15.6 per cent in FY22, higher than its February estimate of 14.5 per cent in FY22.

The growth print is likely to be supported by the relative resilience of the industrial sector in this phase of the pandemic, steady uptick in exports and improved government capital expenditure levels apart from the base factor,

– Suman Chowdhury, Chief Analytical Officer, Acuite Ratings & Research.

Market moves

Sensex soars 765.04 pts to fresh closing peak of 56,889.76; Nifty rallies 225.85 pts to record 16,931.05

Rupee rallies 40 paise to close at 73.29 (provisional) against US dollar

What ICRA’s chief economist has to say

We estimate GDP growth at a deceptively high 20 per cent in Q1FY22 boosted by abnormally low base of last year’s nationwide lockdown,” said Aditi Nayar, Chief Economist, ICRA.

Understanding the double digit jump

The period from April-June 2021 had less stringenet lockdown norms than the same period of 2020. These partial lockdowns were mainly regional in nature. Besides, a steady growth in exports as well as robust performance of agricultural sector is expected to give a push to GDP growth.

What so special this time

Well the pent-up demand along with low base expected to accelerate India’s economic growth rate in Q1FY22. The Aug. 20-25 Reuters poll of 41 economists showed gross domestic product rose 20.0% in the three-month period, compared with a record contraction of 24.4% in the same quarter a year earlier.

Moving on

India’s GDP had grown by 1.6 per cent in the fourth quarter of last fiscal.

What happened last year?

Last year, a near-complete nationwide lockdown led to a massive 24.4 per cent YoY contraction in Q1FY21 GDP.

Hello and welcome to ET’s GDP liveblog

Tomorrow around 5.30 pm the Ministry of Statistics and Programme Implementation (MoSPI) will release the GDP data for the first quarter (April, May, and June). To track all the latest updates stay tuned…