India to have a double-digit growth this year; overall growth for first half at 13.7%: CEA

India is likely to have double-digit growth in the current fiscal year, Chief Economic Advisor (CEA), Dr Krishnamurthy Subramanian predicted on Tuesday. According to the CEA, India's overall growth for the first half is positioned at 13.7%, and with a little over 6% growth in subsequent quarters, the country would be successful in delivering double-digit growth. The growth is aided largely by rising demand and a robust banking sector, Dr Krishnamurthy Subramanian stated.

"India is likely to have a double-digit growth this year. Overall growth for the first half has been 13.7%. So, even a little more than 6% growth in the subsequent quarters should be able to deliver double-digit growth for this year; India's expected to grow 6.5-7% in 2022," said the CEA.

"Formal sector has emerged well from COVID crisis; informal sector, even though it's been impacted, the nature of its production means that it'll be less impacted. Financial sector has emerged stronger and manufacturing sector shows that India in this decade should grow," the CEA added. 

Cumulative annual growth rate higher for India than China: CEA

As per the Chief Economic Advisor, the cumulative annual growth rate between 2015-19 had been higher for India than China when it came to manufacturing gross value, merchandise exports and manufactured goods exports. The expert stated that the Indian policy response had focused on both demand and supply and had played a huge role in helping the nation make one of the sharpest recoveries among all emerging economies in keeping inflation rangebound. Subramanian added that seminal second generation reforms would further help the country grow over 7% during this decade.

"Compared to 2020, there has been a 38.3% increase in capital expenditure in the first half of 2021, which is noteworthy. Since capital expenditures are much higher this year, it's important to understand the inflation dynamics," said Subramanian.

Earlier today, official data showed that India's economy had surpassed pre-COVID levels with its GDP growth standing at 8.4% in the second quarter of 2021-22. In value terms, the GDP stood at Rs 35,73,451 crore in July-September 2021-22, higher as compared to the Rs 35,61,530 crore in the corresponding period of the 2019-20 financial year. The robust numbers come as a commendable achievement given that India faced a massive second wave of COVID-19 in mid-April. 

(With agency inputs)