India’s Gross Domestic Product (GDP) showed impressive growth as it soared to 20.1% between April and June for the first quarter of 2021-22. The growth rate in the last fiscal year was -24.4%, which was mainly due to the lockdown caused by the coronavirus.
Recovery of country’s economy
Despite the severe impact of the second wave of pandemic, the significant improvement in the GDP rate in the June quarter shows that the country’s economy has recovered rapidly after negative growth in the first two quarters of 2021.
Third consecutive quarter of positive growth
This is the third consecutive quarter of positive growth, with GDP growth of 0.5% in the third quarter of 2021 and a growth of 1.6% in the fourth quarter of 2021. However, the double digit GDP growth is consistent with multiple public opinion polls and the Reserve Bank of India (RBI) forecast.
Forecast by The RBI
The central bank had forecast that GDP in the first quarter of 2021-22 could increase by 18.5% from the previously anticipated 26.2% growth rate. Although in June of this year, it has drastically lowered its GDP growth forecast for 2021-2022 from 10.5% to 9.5%.
Economic blockage due to Covid-19
In the first two quarters of 2020, due to the outbreak of the coronavirus pandemic, the country was completely blocked and all economic activities ceased, so the growth was -24.4% and -7.4%, respectively.
After the relaxation of restrictions and festival-related activities began in October 2020, the third and fourth quarters gradually showed a meager but positive growth trend.
