India's real gross domestic product (GDP) grew by 20.1 percent in the April-June quarter of the fiscal year 2021-22, a record quarterly print on the back of a low base last year, data released on August 31 showed.
GDP contracted by 24.4 percent in the April-June quarter in FY2021 as the country went into a lockdown to curb the spread of the coronavirus. It was the steepest quarterly contraction in the economy in independent India's history.
The GDP print of 20.1 is at par with consensus estimates. As per a poll of 41 economists by news agency Reuters, India’s GDP was expected to rise 20 percent in April-June 2021.
The Reserve Bank of India had projected Q1 GDP to grow by 21.4 percent.
"The numbers are a lot better than what we had expected," said Probab Sen, former Chief Statistician and head of a standing committee tasked with overhauling India's statistical data collection.
Data released by the National Statistical Office on August 31 showed that the real gross value added for Q1 rose by 18.8 percent. The biggest year-on-year rise was in the construction sector at 68.3 percent. This sector saw the steepest fall in the same period last year at 49.5 percent as construction activity across the country had come to a halt.
Second wave impact blunted by manufacturing rise
Manufacturing, which fell 36 percent in April-June last year, bounced back to grow by 49.6 percent.
Trade, hotels, transport, communication and services related to broadcasting, which tanked 48.1 percent in April-June last year, grew by 34.3 percent in Q1FY22, indicating that touch services sectors like hotels, hospitality and tourism continue to be affected by the Covid-19 pandemic and will take time to recover.
Agriculture, the only sector which showed growth in Q1FY21 at 3.5 percent, grew by 4.5 percent in the first quarter of FY 22.
Though better, sectoral and headline numbers indicate that the recovery has not been as sharp as the contraction in the previous year, mostly due to the furious second COVID wave that peaked in May.
The starkest example is the household consumption, typified by Private Final Consumption Expenditure. As a rate of GDP, it was 55.1 percent compared with 55.4 percent even in the lockdown quarter. It remained nearly the same in a quarter with nationwide lockdown compared to a quarter in which there was economic activity.
However, Government Final Consumption Expenditure, as a rate of GDP, fell to 13 percent from 16.4 percent in the same period last year.
The Modi government's infrastructure and public investment push showed in the Gross Fixed Capital Formation figures, which came at 31.6 percent against 24.4 percent in the same period of the previous fiscal.Q1 GDP: India's economy grew 20.1% in April-June quarter; manufacturing sector the bright spot - Moneycontrol.com
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