Economic Survey pegs India’s FY 2021-22 growth at 11%

New Delhi: The Indian economy may contract by 7.7% in the current financial year ending on March 31 while the growth could be 11% in next financial year, says the Economic Survey.

The Economy Survey was tabled in Parliament by Finance Minister Nirmala Sitharaman.

It said that the contraction in FY21 is mainly due to coronavirus (Covid-19) pandemic and the visible damage caused by the subsequent countrywide lockdown to contain it.

The survey unveiled two days before the Union Budget is broadly in line with forecasts by the Reserve Bank of India (RBI) which has said it expected the country’s GDP to contract by 7.5 per cent in the year ending March 31.

The International Monetary Fund (IMF) recently pegged the contraction in India’s economy at 8 per cent in 2020-21. It expects a growth rate of 11.5 per cent in the 2021-22 before a decline to 6.8 per cent in 2022-23 and that India will regain the tag of the fastest-growing large economy in the world in both years.

In the quarter ended June 2020, the GDP contracted by 23.9 per cent followed by a milder contraction of 7.5 per cent in the quarter ended September 2020.

“India was the only country to announce a slew of structural reforms to expand supply in the medium to long term and avoid long-term damage to productive capacities,” said the survey.

“The upturn in the economy while avoiding a second wave of infections makes India a sui generis case in strategic policymaking amidst a once-in-a-century pandemic,” it added.