National Statistics Office to announce GDP estimates for Q3 FY 2021- 22 on February 28
National Statistics Office to announce GDP estimates for Q3 FY 2021- 22 on February 28
According to SBI’s research report- Ecowrap, the country’s Gross Domestic Product (GDP) is likely to grow at the rate of 5.8% in the third quarter of FY 2022.
To surpass pre-pandemic levels, the country’s economy grew by 8.4% in the second quarter of 2021-22. However, GDP growth in the July-September period was slower than the 20.1% expansion in the previous quarter.
The National Statistical Office (NSO) will announce the GDP estimates for Q3 FY 2021- 22 on February 28.
The report said, “As per the SBI Nowcasting model, the projected GDP growth for Q3 FY2012 will be 5.8% with a downward bias. The full year (FY22) GDP growth is now estimated to be our 9.3 per cent. % has been revised to 8.8% from the earlier estimate,” the report said on Friday.
The Nowcasting model is based on 41 high frequency indicators linked to industry activity, service activity and the global economy.
The report said that the real GDP will be about 2.35 lakh crores higher / 1.6% higher than the real GDP of 145.69 lakh crores of FY 2015.
The report said that recovery in domestic economic activity is yet to take place on a broader basis, as private consumption has remained below pre-pandemic levels.
Higher frequency indicators suggest that some weakening in demand in Q3 will also continue till January 2022, reflecting the drag on contact-intensive services.
Rural demand indicators, say two-wheeler and tractor sales, have continued to decline since August 2021.
Among urban demand indicators, sales of consumer goods and passenger vehicles declined in the third quarter, while domestic air traffic weakened due to the spread of the Omicron variant. While investment activity is showing an upswing, goods exports remain buoyant, it said.
The report said that this slow growth corroborates recent claims that early growth recovery needs to be supported by a longer than anticipated adjustment policy.
“Thus we expect liquidity normalization to be delayed. This may have a softening effect on the yield of government securities (G-secs) from the current 6.7 per cent to around 6.55% or more,” the report said. “
The report suggested that the government could offer livelihood loans of up to Rs 50,000 to the rural poor.
This loan can be granted on the basis that interest-servicing alone will maintain the standard of the loan and subsequent loan renewals will be linked to the successful repayment record, it said.
“If the government were to bear a 3% interest subsidy on a portfolio of ₹50,000 crore, the outlay during 2022-23 would be only ₹1,500 crore. And these loans would also act as a major consumption booster at subsistence levels.” Said it.
The added benefit of these micro livelihood loans is that they will help the banking system to create a comprehensive database and credit history of marginal borrowers, which can be used to create new loan-worthy lending classes, the report said. .
The existing overdraft facility for PMJDY accounts in the banking system, which has been in existence for some time, may be streamlined and technology enriched with a central nodal agency/bank for monitoring and promotion of the scheme.
The report further noted that given the significant success of vaccination in the third wave in rural areas, livelihood credit could propel the broader economy to unprecedented heights.
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