New Delhi: Apart from the second wave of Covid-19, Head of Economic Advisor (CEA) K Sub Subramanian, Monday expressed hope that economic growth during the current financial year will be around 11 percent as projected in the latest economic survey.
He also said the overall impact of the second wave on the economy would not be very large.
“We will be in the ballpark,” Subramanian said when asked whether the target of the GDP growth economic survey would be filled in the background of the second wave of pandemic.
Economic Survey 2020-21, released in January this year, has projected 11 percent GDP growth during the current financial year which ended March 2022.
The survey said growth would be supported by the supply side boost from reform and regulatory easing, encouragement for infrastructure investment, encouragement In the manufacturing sector through incentive schemes (PLI) associated with production, recovery of hidden demand, increased discretionary consumption after a vaccine rollout and retrieves credit given adequate liquidity and low interest rates.
“We will grow at a high growth rate this year.
This year’s growth will be from the bottom base but we anticipate growth of 6.5-7 percent next year FY’23 and from there, growth has increased further,” he said.
Growth will be assisted by various structural reforms, including labor and agricultural laws, carried out by the government, he said while overcoming an event organized by the Indian construction equipment manufacturer association.
Given the various seminal reforms introduced in 1991, he said they encouraged the Indian economy to the high growth trajectory.
Subramanian also said future growth will take place without inflation that runs away when India has transferred various supply side friction points through structural reforms during a pandemic.
With regard to the budget target, he said infrastructure expenditure which was announced would be fulfilled and the finance minister urged various PSUs to approach their capital expenditure plan.
The Union budget for 2021-22 has provided capital expenditure of 5.54 lakh crore, an increase of 34.5 percent on budget estimates 2020-21.
The estimated capital expenditure budget for FY2020-21 is Rs 412 Lakh Crore.