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Chidambaram Reacts To India's 20.1% Q1 GDP Growth Rate; Adds Caveat Why It's 'negative'

P Chidambaram has reacted to the news of India recording a GDP growth of 20.1% in April-June 2021 vis-a-vis the corresponding period in the previous year.

P Chidambaram, GDP


Senior Congress leader and former Finance Minister P Chidambaram has reacted to the news of India recording a GDP growth of 20.1 percent in the April-June 2021 quarter compared to the first quarter of the 2020-21 financial year. Taking to Twitter, Chidambaram highlighted that despite the tremendous growth rate of 20.1 percent, it remains a negative growth compared to the first quarter of 2020-21, which registered a contraction of 24.4 percent. He opined that the country has not fully recovered from the decline reported in the previous year while adding that India's GDP remains below the levels in the first quarter of the pre-pandemic year, i.e. 2019-20.

India registers massive growth in Q1 2021-22

The Ministry of Statistics and Programme Implementation (MoSPI) announced growth in India's GDP by 20.1 percent in the quarter of April-June 2021. The substantial recovery can be attributed to the Centre and state government's localized and calibrated lockdowns to control the surge of COVID-19 cases during the second wave, as against the complete lockdown imposed during the first wave in 2020.

Moreover, Chief Economic Advisor KV Subramanian has stated that India is poised for stronger growth from structural reforms, Government Capex push and rapid inoculation against COVID-19.

According to MoSPI, GDP at Constant (2011-12) Prices in Q1 of 2021-22 is estimated at ₹ 32.38 lakh crore, as against ₹ 26.95 lakh crore in Q1 of 2020-21, showing a growth of 20.1 percent as compared to a contraction of 24.4 percent in Q1 2020-21. 

Moreover, GDP at Current Prices in the year Q1 2021-22 is estimated at ₹ 51.23 lakh crore, as against ₹ 38.89 lakh crore in Q1 2020-21, showing a growth of 31.7 percent as compared to a contraction of 22.3 percent in Q1 2020-21.

GDP is derived as the sum of the gross value added (GVA) at basic prices, plus all taxes on products, less all subsidies on products. The total tax revenue used for GDP compilation includes Non-GST Revenue and GST Revenue. MoSPI stated that the latest information on the website of the Controller General of Accounts (CGA) and Comptroller and Auditor General of India (CAG) was used for estimating taxes on products and subsidies on products at Current Prices, for ascertaining the GDP growth for the first quarter of 2021-22.

Image Credit: PTI

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