NEW DELHI: India’s GDP grew 8.4% in the July-September 2021 quarter, on the back of improving private consumption and industrial activities, giving the government hope that growth will be in double digits in the current financial year.
The growth has surpassed pre-Covid levels. In value terms, GDP stood at Rs 35,73,451 crore during July-September 2021, higher than the Rs 35,61,530 crore recorded in the corresponding period in 2019-20, before Covid.
The economy had contracted 7.4% in the July-September quarter of 2020-21, data released by the National Statistical Office showed.
“Overall growth for the first half has been 13.7%. So, even a little more than 6% growth in the subsequent quarters should be able to deliver double-digit growth for this year,” said Chief Economic Advisor K V Subramanian.
This confidence was boosted by the output of the eight core sectors, which grew 7.5% in October against a 0.5% contraction a year ago. Agriculture was steady despite an uneven monsoon, while other sectors showed signs of improvement.
Notably, private final consumption expenditure in the economy grew 8.6% growth at Rs 19,48,346 crore against Rs 17,93,863 crore.
The government’s final consumption expenditure also grew from Rs 3,32,582 crore to Rs 3,61,616 crore.
Experts, however, advise caution.
“The disaggregated data is far from convincing, with considerable lags in private and government consumption expenditure being absorbed by a sharp rise in valuables relative to the pre-Covid level of Q2 FY2020,” said Aditi Nayar, chief economist at ICRA.
The latest NielsenIQ’s FMCG Snapshot for the third quarter of 2021 narrates a mixed bag consumption story. While the FMCG sector grew at 12.6% in the July-September quarter, the growth was urban-led with rural India seeing a slowdown due to consumption decline.