Globally, at a time when the economies in the US and China are showing signs of rebounding, India is yet to unlock itself fully as the country continues its battle against COVID-19. In such a scenario, the industry body CII seeks to present three aspects that would determine the GDP growth.
If the business goes as usual, then the growth rate would touch 6.5 pc and on course to hit $5 trillion by FY26, while an optimistic or pessimistic estimate would see the GDP growth at 9 pc and 5 pc respectively, said CII President TV Narendran.
Assuming that “a third wave of COVID-19 occurs with a significant impact on both lives and livelihoods, no significant reforms are announced and fiscal push to growth remains negligible,” then the GDP growth would be 5 pc, he sought to point out adding if most of the population is vaccinated and the Centre pushes through with big-ticket reforms, it would result in a growth of 6.5 pc, aided by fiscal support to the extent possible.
The GDP growth could go past the 9 pc mark, if herd immunity kicks in, and is backed by big-ticket reforms especially in the area of factor markets, financial sector and ease of doing business. Together, with a generous fiscal support from the government will make this possible, Narendran said on Thursday. “CII expects GDP to grow at 9.5 pc in FY22. This will take the GDP to a level that is highly higher than in FY20. Strong growth in the H2 will be supported by robust external demand and large scale coverage of vaccination allowing resumption of economic activity.” Interestingly, he also mooted the appointment of a ‘Vaccine czar’ to speed up the immunisation drive. In rural India, people are caught between “hesitancy and paranoia” in this regard.
