India's economy grew at a record 20.1 per cent year-on-year in April-June quarter, official data on Tuesday showed, rebounding from a deep slump last year, helped by improved manufacturing in spite of a devastating second wave of COVID-19 cases.
The read-out for June quarter was in line with the 20.0 per cent growth forecast of analysts in a Reuters poll, and much higher than 1.6 per cent growth rate for the previous year. The economy had contracted 24.4 per cent in the same quarter a year earlier.
Radhika Rao, Economist, DBS Bank, Singapore
"India's GDP rose 20 per cent in the June quarter, close to our forecast, with base effects magnifying the extent of jump in the headline, whilst the impact of the second COVID-19 wave better reflected in the sequential contraction. Numbers were also partly influenced by seasonal distortions (i.e. end FY-March quarters)."
"Agricultural output proved to be resilient, alongside better construction and manufacturing activity owing to less stringent localised restrictions versus the first COVID wave, whilst contact-intensive services lagged."
Sreejith Balasubramanian, Economist - Fund Management, IDFC Amc, Mumbai
"Nominal GDP for the June quarter, which witnessed the second wave of COVID-19 infections, grew 31.7 per cent y/y while real GDP grew 20.1 per cent. Driven by base effect, as this actually represents a higher-than-usual quarter-on-quarter fall, the reading was slightly below consensus and also reflects a high GDP deflator."
"Vaccination progress will be crucial, given the possibility of a third wave of infections and the experience of countries which witnessed it. Support from rural, particularly agriculture, needs to be monitored given the fluctuations in monsoon rainfall and its impact on reservoir levels and crop harvest."
Upasna Bhardwaj, Senior Economist, Kotak Mahindra Bank, Mumbai
"The GDP figures for the first quarter came in marginally weaker than our expectations (21.7 per cent growth). However, economic activity has been reviving since July and has picked up momentum. As vaccination pace picks up we expect the momentum to pickup further, although remain wary on the evolution of delta variant cases."