The Economic Survey tabled by Finance Minister Nirmala Sitharaman has projected 7.7 percent contraction in India's GDP in FY2020-21. The survey has pegged FY22 GDP growth at 11 percent on back of "mega vaccination drive" and robust "consumption growth".
The contraction comprises sharp 15.7 percent decline in first half and a modest 0.1 per cent fall in the second half, according to the survey. "Sector-wise, agriculture has remained the silver lining while contact-based services, manufacturing, construction were hit hardest, and have been recovering steadily. Government consumption and net exports have cushioned the growth from diving further down," the Economic Survey added.
"V-shaped economic recovery is supported by the initiation of a mega vaccination drive with hopes of a robust recovery in the services sector. Together, prospects for robust growth in consumption and investment have been rekindled with the estimated real GDP growth for FY 2021-22 at 11 per cent," the survey said.
India's mature policy response to this "once-in-a-century" crisis thus provides important lessons for democracies to avoid myopic policymaking and demonstrates the significant benefits of focusing on long-term gains, the survey added.