New Delhi: India’s economic growth surged to 20.1 per cent in the April-June quarter of this fiscal. This growth was helped by a low base of the year-ago period. The growth took place despite the devastating second wave of Covid-19. The gross domestic product (GDP) had contracted by 24.4 per cent in the corresponding April-June quarter of 2020-21, according to data released Tuesday by the National Statistical Office (NSO).
The government had imposed a nationwide lockdown at the onset of the Covid-19 pandemic last year. This year, the massive second wave of the pandemic hit India in the middle of April, which forced states to impose fresh restrictions.
However, the economy has still not returned to the pre-COVID level.
In value terms, the GDP stood at Rs 32,38,020 crore in April-June 2021-22, lower than Rs 35,66,708 crore in the corresponding period of the 2019-20 financial year. The GDP had shrunk to Rs 26,95,421 crore in April-June last year during the nationwide lockdown.
“GDP at Constant (2011-12) Prices in Q1 of 2021-22 is estimated at Rs 32.38 lakh crore, as against Rs 26.95 lakh crore in Q1 of 2020-21, showing a growth of 20.1 percent as compared to contraction of 24.4 percent in Q1 2020-21,” the NSO said in a statement.
With a view to containing the second wave of the pandemic, localized and calibrated lockdowns were imposed during the first quarter of 2021-22, the NSO added.
Restrictions were imposed on the economic activities not deemed essential, as also on the movement of people.
“The lockdown instructions in various states were duly considered by the National Statistical Office. The impact on economic activities and the data collection mechanisms owing to Covid-19 pandemic has an effect on the quarterly GDP estimates also. “The impact of these measures on overall economic activity is embedded in source data,” it stated.
According to the NSO data, gross value added (GVA) growth in the manufacturing sector accelerated to 49.6 per cent in the first quarter of 2021-22, compared to a contraction 36 per cent a year ago. Farm sector GVA growth was up at 4.5 per cent, compared to 3.5 per cent earlier.
Construction sector GVA grew by 68.3 per cent compared to 49.5 per cent contraction earlier. Mining sector grew by 18.6 per cent, as against a contraction of 17.2 per cent a year ago.
Electricity, gas, water supply and other utility services segment also grew by 14.3 per cent in the first quarter of this fiscal, against 9.9 per cent contraction a year ago.
Similarly, trade, hotel, transport, communication and services related to broadcasting grew by 34.3 per cent compared to 48.1 per cent contraction earlier.
Financial, real estate and professional services grew by 3.7 per cent in Q1 FY22 compared to a contraction of 5 per cent.
Public administration, defence and other services grew at 5.8 per cent during the quarter under review, compared to (-) 10.2 per cent a year earlier.
Congress leader and former Finance Minister P Chidambaram meanwhile cautioned against ‘celebrating’ the 20.1 per cent surge in GDP growth. He said it was helped by a low base of the year-ago period and that the economy is still some distance away from the pre-pandemic level.
“We are still below the GDP level in the first quarter of the pre-pandemic year 2019-20. We have still some distance to go before the economy can be said to have achieved the pre-pandemic level,” Chidambaram said in a tweet.
“Before we ‘celebrate’ the 20.1% GDP growth in Q1 (April-June) of 2021-22, please pause to consider the following. This ‘growth’ is on a low, actually negative, base of (-) 24.4% in Q1 of 2020-21,” he said in another tweet. “That means that in the first quarter of this year, we have not fully recovered from the decline of last year. In terms of economic activity, we are still behind in sectors such as Private Consumption, Gross Fixed Capital Formation and Imports,” the former finance minister added.
