Higher fiscal spending pushes India's GDP for Q2FY22 above 8%, crosses pre-COVID level
The accelerated vaccination drive also played a role in this YoY rise as it brightened consumer sentiments.
There is good news for the country on the economic front. Along with the better monsoon season, India's gross domestic product (GDP) growth rate has seen a jump in the second quarter. The country's GDP has been recorded at 8.4 percent on a year-on-year basis. The central government has released GDP figures for the second quarter in the financial year 2021-22. With this recovery, the GDP of the country has now crossed the pre-COVID-19 levels.
The acceleration in the GDP came as a result of higher central fiscal spending as well as consumption recovery and healthy monsoon season. Besides, pent-up demand, higher exports along with a rise in service activity amid further improvement in mobility supported the uptrend.
The accelerated vaccination drive also played a role in this YoY rise as it brightened consumer sentiments. On a YoY basis, India's GDP growth rate had fallen by 7.4 per cent during the corresponding period of the previous fiscal. On a sequential basis, the GDP growth rate during Q2FY22 was lower than the rise of 20.1 per cent recorded for Q1FY22.
India's GDP at constant 2011-12 prices has been estimated at Rs 35.73 lakh crore in Q2FY22, as against Rs 32.97 lakh crore in Q2FY21.
"GDP at Constant (2011-12) Prices in Q2 2021-22 is estimated at Rs 35.73 lakh crore, as against Rs 32.97 lakh crore in Q2 2020-21, showing a growth of 8.4 per cent as compared to 7.4 per cent contraction in Q2 2020-21," the National Statistical Office (NSO) said in its Q2FY22 GDP estimates.
"Quarterly GVA at Basic Prices at Constant (2011-12) Prices in Q2 2021-22 is estimated at Rs 32.89 lakh crore, as against Rs 30.32 lakh crore in Q2 2020-21, showing a growth of 8.5 per cent," it added.
The GVA includes taxes but excludes subsidies.
Notably, the government had imposed a nationwide lockdown last year to contain the corona pandemic. It had a profound effect on economic activities. In view of the second wave of the devastating epidemic in mid-April this year too, the states had imposed various restrictions for its prevention.