New Delhi, Jan 31 (EFE).- The Indian government on Monday predicted that the country’s GDP would grow by 8-8.5 percent during the next financial year, between April 2022 and March 2023, down from the 9.2 percent forecast for the current year.
“India to witness GDP growth of 8.0-8.5 per cent in 2022-23, supported by widespread vaccine coverage, gains from supply-side reforms and easing of regulations, robust export growth, and availability of fiscal space to ramp up capital spending,” the ministry of finance said in a statement.
On Monday, Finance Minister Nirmala Sitharaman presented the annual economic survey in the Indian parliament, a day before she is set to unveil the general budget.
The survey said that the agricultural sector, which employs more than of India’s workforce, was the least affected by the pandemic and is expected to grow by 3.9 percent during the current fiscal year, up from its 3.6 percent growth during the previous cycle.
The ministry expected industry to grow by 11.8 percent in 2021-22, sharply recovering from its 7 percent contraction during the year before.
Both the government and the Reserve Bank of India have repeatedly reduced their growth forecasts for the 2021-22, due to the impact of the virulent second coronavirus wave that peaked in April-May 2021.
“This implies that overall economic activity has recovered past the pre-pandemic levels. Almost all indicators show that the economic impact of the ‘second wave’ in Q1 was much smaller than that experienced during the full lockdown phase in 2020-21, even though the health impact was more severe,” the ministry statement said.
The Indian economy suffered a sharp fall of 7.3 percent in its GDP in the fiscal year 2020-2021, mainly due to a 24.4 percent fall between April and June 2020 caused by a strict nationwide lockdown to check the spread of the coronavirus.
The ministry stressed that “inflation has reappeared as a global issue in both advanced and emerging economies,” and acknowledged that India had also been affected by rising food prices.
The consumer price index stood at 5.2 percent between April and December 2021, compared to 6.6 percent during the same period in 2020, although the economic survey highlighted that inflation in wholesale prices had risen to double digits and was expected to touch 12.5 percent during 2021-22. EFE