Hans Timmer, Chief Economist (South Asia) of the World Bank said that when we look at the high-frequency data, it seems that the correction has stalled because of the second wave, while many of the figures actually indicate some decline in the correction.
The World Bank says the Indian economy is expected to grow at 8.3 percent in 2021-22, fueled by increased public investment and incentives to boost manufacturing. However, this is lower than previously estimated for a second wave of the pandemic in early 2021.
Hans Timmer, Chief Economist (South Asia) of the World Bank, said that this does not seem like much given the sharp decline in the economy last year, but I think it is really very important given the deadly second wave and the seriousness of the health crisis. There is positive news. We are still positive about the possible outcomes for the Indian economy.
The more progress we are making in the current year, the lesser the uncertainty. On March 31, the World Bank had said in a report that during 2021-22, the real growth rate of India’s GDP could be between 7.5 to 12.5 percent.
The economic growth rate will be 9.5 percent in 2021-22: RBI
The RBI on Friday retained the economic growth forecast for 2021-22 at 9.5 percent. However, worldwide semiconductor shortages, rising commodity prices, rising production costs, potential volatility in global financial markets, and increased infection cases can pose risks to economic growth.
Central bank governor Shaktikanta Das said aggregate demand has increased in August-September. This is reflected in railway freight traffic, port goods, cement production, electricity demand, e-way bill, GST, and toll collection.
With the reduction in infection cases and improving consumer confidence, private consumption is helping to increase. The aggregate demand has also been greatly helped by exports. Exports exceeded $30 billion for the seventh consecutive month in September 2021, reflecting strong global demand and policy support. Reforms in the service sector are also gaining momentum.