India to register double-digit growth this year, says govt’s chief economic advisor

Expressing optimism over India’s GDP performance in the second quarter, country’s Chief Economic Adviser (CEA) K V Subramanian on Tuesday said the Asia’s third-largest economy is expected to register double-digit growth in the current financial year, aided by rising demand and a robust banking sector.

He also said India is expected to grow at 6.5 to 7 per cent in 2022-23 and over 7 per cent thereafter.

“India is likely to have a double-digit growth this year; overall growth for the first half has been 13.7 per cent. So, even a little more than 6 per cent growth in the subsequent quarters should be able to deliver double-digit growth for this year; India's expected to grow 6.5-7 per cent in 2022

India's GDP growth soared by 8.4 per cent in the second quarter of 2021-22, with the economy surpassing the pre-COVID level, official data showed on Tuesday.

With regards to fiscal deficit, he said the Budget estimate is likely to be met.

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The government estimates fiscal deficit at 6.8 per cent of the gross domestic product (GDP) for the current financial year ending on March 31, 2022.

“Formal sector has emerged well from Covid crisis, informal sector, even though it's been impacted, the nature of its production means that it'll be less impacted. Financial sector has emerged stronger and manufacturing sector shows that India in this decade should grow,” said Subramanian, whose tenure ends on December 6.

“Compared to 2020, there has been a 38.3% increase in capital expenditure in the first half of 2021, which is noteworthy. Since capital expenditures are much higher this year, it's important to understand the inflation dynamics," he added.

(With inputs from agencies)