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‘Growth to bounce back in FY22, but on low-base effect’

From a trend growth perspective, India will still be at a lower level at the end of the next fiscal and meaningful recovery may take place only in FY23, it said.

By: ENS Economic Bureau | New Delhi |
February 11, 2021 1:11:19 am
SBI Research on Wednesday revised its contraction forecast for the current fiscal year to 7 per cent. The agency had earlier forecast a 7.4 per cent contraction in 2020-21 GDP numbers.

Even as economic recovery is gaining ground, India’s GDP is projected to grow at 10.4 per cent in FY22 mainly due to a low base, after a 7.8 per cent contraction in the current fiscal, India Ratings and Research said on Wednesday. From a trend growth perspective, India will still be at a lower level at the end of the next fiscal and meaningful recovery may take place only in FY23, it said.

“This fiscal year (FY21) is giving us the worst growth in independent India, next fiscal will be the best because of the base effect because we have slowed down so much this year,” India Ratings’ Chief Economist Devendra Pant said.

Separately, SBI Research on Wednesday revised its contraction forecast for the current fiscal year to 7 per cent. The agency had earlier forecast a 7.4 per cent contraction in 2020-21 GDP numbers.

It, however, retained GDP forecast for FY22 at 11 per cent, but with the caveat that it won’t fall below 11 per cent. This is in line with RBI’s estimate of 10.5 per cent.

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