India is one of the few economies that is recovering strongly; Omicron effects are said to be less severe: Finmin report

NEW DELHI: India will be among the few economies in the world to rebound strongly from the 2020-21 economic contraction caused by Covid-19, according to a Treasury Department report that reassuringly says the impact of the Omicron- Variant on the economy due to the rapid development will be less severe vaccination.
Real GDP grew 8.4 percent year-on-year in the second quarter of FY 2021-22 and recovered more than 100 percent of pre-pandemic production in the corresponding quarter of FY 2019-20, according to the monthly economic overview of the Ministry of Finance.
“India is among the few countries that have seen four consecutive quarters of growth in the midst of Covid-19 (Q3, Q4 of FY21 and Q1, Q2 of FY22), reflecting the resilience of the Indian economy. full recovery in manufacturing and continued growth in agricultural sectors, “it said.
The recovery points to a boost in the investment cycle, aided by a rising vaccination rate and efficient economic management that activates the macro and micro growth drivers, the report said.
India’s economic recovery is likely to gain further strength in the remaining quarters of the fiscal year, as shown by 19 of 22 high frequency indicators (HFIs) in September, October and November 2021 that exceeded their pre-pandemic levels in the corresponding months of 2019, it said.
“But Omicron, a new variant of Covid-19, could pose a new risk to the ongoing global recovery. However, preliminary evidence suggests that the Omicron variant is likely to be less severe and even more so as the vaccination rate increases in India, ”the Treasury Department announced.
Given that the Covid-19 pandemic has resulted in significant human and economic costs that have held countries back from their development goals, the latest review states that 2021 will be a “catch-up year” for the global economy, including India is trying to recover from pre-2019 pandemic levels.
Not only did India catch up with its production ahead of the second-quarter pandemic, but it is expected to do so for the full year, it said, adding that the Monetary Policy Committee (MPC) in its December statement had added 9, 5 percent in FY2021-22, implying a full recovery and 1.6 percent growth from pre-pandemic GDP levels in FY 2019-20.
“India will be one of the few economies in the world that is recovering strongly from the economic contraction caused by Covid-19 in 2020-21,” it said.
Considering that the agricultural sector was the foundation on which the economic contraction in India was minimized in FY2020-21 and the recovery accelerated in FY2021-22, the report states that food grain production is increasing and MSPs are increasing For both Kharif and Rabi cultures increasing in 2021 -22 have also increased rural incomes.
Central government finances improved from April 2021 to October 2021 from the corresponding period last year, with both direct and indirect taxes showing significant year-over-year growth, adding that sustained improvement in revenue collection is good for achieving the The government’s budget deficit target promises 6.8 percent of GDP for the current fiscal year.
In the first seven months of FY 2021-22, the government increased public investment in infrastructure by 28.3 percent over the corresponding period last year, with an emphasis on railways, road transport and highways, and housing and urban affairs.
Revenue spending saw significantly lower growth of 7.5 percent over the previous year, suggesting a significant shift towards a significantly improved quality of overall spending, she added.