Growth rate will be 8.5 percent in the financial year 2021-22: ICRA

Credit rating agency ICRA has released an estimate of 8.5 percent growth rate of the country’s gross domestic product (GDP) in the current financial year. ICRA has projected GDP growth rate to be 8.5 percent and Gross Value Added at 7.3 percent in the financial year 2021-22. It has projected a growth rate of 14.9 percent in the first quarter, eight percent in the second quarter, 5.6 percent in the third quarter and seven percent in the fourth quarter.
If the vaccination of COVID-19 accelerates, the GDP will grow rapidly in the third and fourth quarters and the growth rate for the whole financial year can also reach 9.5 percent. Aditi Nair, Chief Economist of ICRA, said the impact of the second wave of Kovid-19 and the restrictions issued by the state governments was visible on many economic data for April and May. In view of the reduction in new cases of the epidemic and gradual relaxation of restrictions by the states, we have forecast the growth rate to be 8.5 percent in the financial year 2021-22.
In its report, ICRA said rural demand and consumer sentiment remained weak, despite expectations of an increase in crop production with forecasts of a normal monsoon and a decrease in migrants returning to villages compared to last year. The reason for this is the rapid rise in rural inflation and the shortfall in the capital expenditure with the people due to the inflation of fuels.