India Q1 GDP Data: Here's All You Need To Know
Despite the record growth in the first quarter of the current fiscal, the economy is yet to reach its pre-COVID levels. However, after recovering from the second wave, India is now on track to achieve the world's fastest growth this year.
On the demand side, the recovery of pre-pandemic levels was significant in government consumption at 107.4 per cent and exports at 108.7 percent. The recovery in private consumption is close to 90 per cent, according to data released by the National Statistical Office (NSO) on Tuesday, August 31.
Whereas on the supply side, recovery of the pre-pandemic levels was most significant in the agriculture and allied sectors, which stood at 108.2 per cent and recovery in manufacturing was about 96 per cent.
The gross value added (GVA) growth in the manufacturing sector accelerated to 49.6 per cent in the first quarter of the current fiscal, compared to a contraction of 36 per cent in the year-ago period.
The construction sector grew by 68.3 per cent in the June quarter, compared to a contraction of 49.5 per cent in the year-ago period. The mining sector grew by 18.6 per cent, compared to a contraction of 17.2 per cent a year ago.
Consumer spending - the main driver of the economy - increased 19.34 per cent year-on-year in the June quarter, compared to the year-ago period, but remained lower than its pre-pandemic level.
The Reserve Bank of India, which has maintained an accommodative stance to support the economy, has predicted annual growth of 9.5 per cent in the current fiscal - same as the projection by the International Monetary Fund for the country.
While briefing the media on Tuesday, Chief Economic Advisor KC Subramanian said that the GDP data for the first quarter reaffirms the government's prediction of an imminent V-shaped recovery made last year.
The GDP contracted by a record 24.4 per cent in the corresponding quarter of the previous fiscal 2020-21, mostly due to the nationwide lockdown induced by the pandemic which threatened the pace of the economy and brought industrial activity to a halt.
Recording its worst-ever performance in more than four decades, India registered a de-growth of 7.3 per cent for the fiscal year 2020-21, putting it among those major economies hit hardest by the COVID-19 pandemic.