lipped from: https://www.thehindubusinessline.com/todays-paper/economy-may-have-grown-at-57-62-in-q3/article65063868.ece
Officials acknowledge that third wave did have some impact, but not significant | Photo Credit: designer491
Limited impact of 3rd wave, rise in GST mop-up are positives; official numbers on Feb 28
The economy is expected to have grown between 5.7 per cent and 6.2 per cent in the three-month period ended December 31, 2021 (Q3 of fiscal year 2021-22). The government will come out with the growth number for the period along with the second advance estimate for the current fiscal on February 28.
Government officials acknowledge that the third wave of the Covid pandemic did have some impact, but it was not significant. They drew attention to the Monthly Economic Report of Economic Affairs Department saying that “the impact of the third wave on economic activity appears to be much less, even compared to the muted impact of the second wave.”
Rise in GST collection
Another positive factor highlighted by the officials is the rising GST collection, which was Rs. 1.29-1.38-lakh crore during the period. Since this tax is levied on goods and srvices consumed, higher collection shows improvement in demand/consumption. They expect growth to be better.
However, many research agencies do not share such optimism. The Economic Research Department of State Bank of India forecast GDP growth for Q3 at 5.8 per cent, with a downward bias. “Interestingly, the GVA (Gross Value Added) will be higher than GDP (Gross Domestic Product) because of a distorted base,” it said in a report authored by its chief economist Soumya Kanti Ghosh.
Rating agency ICRA expects the year-on-year (YoY) growth of GDP and GVA Q3 to display a broad-based, base effect-led moderation to 6.2 per cent and 6.0 per cent respectively, from the performance in Q2 (8.4 per cent and 8.5 per cent, respectively). It projects the GVA growth in services, industry and agriculture, forestry and fishing at 8.2, 4.2 and 2.5 per cent, respectively, in the third quarter as against 10.2, 6.9 and 4.5 per cent in the second.
“The economic recovery gained some traction in Q3 FY22. Rising vaccine coverage and confidence levels instigated a cautious revival in the contact-intensive sectors. Additionally, robust merchandise and service sector exports supported economic activity in Q3 FY22. While the YoY performance of manufacturing volumes was surprisingly feeble, price hikes protected margins in some sectors in that quarter,” ICRA chief economist Aditi Nayar said.
RBI forecast
The Reserve Bank of India has projected 6.6 per cent growth in Q3. For the full year, it expects growth to be at 9.5 per cent while the Central Statistical Organisation has given 9.2 per cent as the growth number in the first estimate.
Also readp3
aniltikotekar4sme.com 