Image Credit: The Indian Express
According to credit rating agency ICRA, India’s Gross Domestic Product(GDP) is expected to grow by 2 per cent in the January to March quarter of the financial year 2020-21. The annual GDP growth during the same fiscal year is expected to contract by around 7.3 per cent. In terms of gross value added(GVA), growth for the fourth quarter was at 3 per cent while for the fiscal, it contracted by 6.3 per cent, according to figures shared by ICRA.
The rating agency has pegged these figures on the baseline expectation that the gross value added for defence, public administration among other services in the country will grow by 9 per cent in the January-March quarter. In comparison, it had contracted by around 1.5 per cent in the September-December quarter of the fiscal year 2020-21.
In a significant statement, ICRA also said that the projected two per cent growth in the March quarter will protect the Indian economy from falling into a phase of a double-dip recession, something which was said by the National Statistical Office(NSO). The NSO was much bleaker in its assessment, projecting only 1.1 per cent growth in the fourth quarter of fiscal 2020-21.
According to Aditi Nayar, Chief Economist at ICRA, the GVA in manufacturing will grow by 4 per cent in the March quarter as opposed to 1.6 per cent in the September-December quarter. She credits these improving numbers to the faster recovery of the Indian economy which is also growing from a lower base due to the Covid-19 induced lockdown.