Mumbai . Foreign brokerage company Barclays has reduced the earlier estimate of India’s economic growth rate to be 10 percent for the financial year 2021-22. He attributed this to the third wave of the epidemic. It has said that the growth rate of the Indian economy can be 6.6 percent in the third quarter of the current financial year.
According to Barclays, the economy remained relatively stable in the third quarter. Work in many sectors has come to a pre-pandemic level. The role of the service sector in these activities is big. Given the Omicron wave in January and the restrictions imposed to curb it, there is a risk of falling below the previously estimated 10 percent growth rate for the financial year 2021-22.
GDP forecast on February 28
In the July-September quarter of the current financial year, the GDP (Gross Domestic Product) growth rate was 8.4 percent. The National Statistics Office will release the GDP estimate for the third quarter of the financial year 2021-22 on February 28.
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Signs of decline in rural consumption
Barclays said in its report that the growth rate could be 6.6 percent in the third quarter, compared to 8.4 percent in the second quarter due to the higher comparative effect. While there are clear signs of a slowdown in rural consumption, the growth rate of the agriculture sector is expected to remain strong.
Fuel demand strengthens
According to the report, the services sector has more impact on the country’s economic growth than manufacturing. Growth in construction, manufacturing and mining has been slow, mainly due to supply constraints in vehicles. Supply issues and the high comparative base effect have had an impact on manufacturing, but growth in the services sector may be faster. Strengthening fuel demand and pick-up in business give clear signs of revival.
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Economy nears pre-pandemic level
According to Barclays, data on the level of traffic ie tourism activities, air traffic, railway freight and movement show that the economy has reached near pre-pandemic levels. Not only this, the increase in debt has remained and the profits of the companies are strong.
The report said that although the Omicron infection did not have a significant impact on the revival, but due to the increase in the number of infections and some restrictions imposed to prevent it, there may be some impact on economic activity in the fourth quarter.
Tags: economic growth, Economy, GDP, GDP growth, India’s GDP
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