India GDP growth rate: Q1 GDP growth seen at new high on recovery | India Business News – Times of India

NEW DELHI: The April-June GDP growth could turn out to be a record quarterly expansion as the economy recovers from the second wave of the pandemic and benefits from the low base of last year.
The country’s statistics office will release the quarterly GDP data on Tuesday and various estimates show that it could range from 10.5% to 31.6%, while the median forecasts of two polls show it at 20% and 21% in April-June, the first quarter in the 2021-22 fiscal year. The RBI had estimated the first quarter growth to be 21.4%. To put the numbers in perspective, the April-June quarter of last year had posted the sharpest contraction on record of 24.4% due to the impact of one of the strictest lockdowns imposed to prevent the spread of Covid.

“Essentially we are looking at a very strong doubledigit growth of 23% for this quarter and likely higher than RBI’s own assessment. A large part of this is because of a very favourable base from last year, when the nationwide lockdown had almost brought the economy to a standstill,” said Yuvika Singhal, economist at QuantEco Research.
“But nevertheless I think this double-digit growth is more of optics than anything else because we need to keep in mind that this was also the quarter when the second wave of the pandemic was extremely ferocious and April and May saw a large number of states getting into piecemeal restrictions, which by the end of May had almost become like a nationwide lockdown, though in a very staggered fashion at the state level,” said Singhal.
Since the April-June quarter of last year, the economy started scripting a robust recovery, but the second wave of the pandemic stalled the process. The unlocking and government spending has helped revive the recovery.
Economists say growth in the first quarter would be led by manufacturing, mining and construction sectors, while the agri segment will also lend strong support. The laggard will be the services sector, which has been hit hard by the two consecutive waves of the pandemic and is yet to recover from the bruising impact. The pace of vaccination, which has gathered momentum now, will also play a crucial role in determining the trajectory of growth in the quarters ahead.
“I think it would be a more broad-based story in the second half of the year unlike now where industry is leading the pack compared to services,” said Madhavi Arora, lead economist at Emkay Global Financial Services.