India’s economy is likely to grow by 11 per cent in the fiscal year beginning April 1, the Economic Survey said.
The “V-shaped recovery is supported by COVID vaccination drive,” the survey said.
The rollout of vaccines against COVID-19, which has killed nearly 1.54 lakh in the country, will re-energise the world’s fifth-largest economy with a growth rate that is strongest since the 1991 economic liberalisation.
India’s GDP contracted by a record 23.9 per cent in Q1 (April-June) and 7.5 per cent in Q2, reflecting the unparalleled effect of the containment measures that were taken to control the pandemic.
The forecast for next year is in line with the International Monetary Fund’s (IMF) estimate of 11.5 per cent expansion, which will once again make India the fastest-growing major economy in the world ahead of China’s 8.1 per cent pace.
The rebound will follow an estimated 7.7 per cent contraction in the Gross Domestic Product (GDP) in the current financial year ending March 31. This is the steepest annual contraction of the economy in the history of independent India.
“The fundamentals of the economy remained strong as gradual scaling back of lockdowns, along with the support of Aatmanirbhar Bharat Mission has placed the economy firmly on the path of recovery,” the survey said.
The survey recommended an increase in public healthcare spending from 1 per cent to 2.5-3 per cent of GDP.
India is expected to witness a current account surplus during the current financial year after a gap of 17 years, it said.
The country recorded a current account surplus of 3.1 per cent of GDP in the first half of the year largely supported by strong services exports.
