Saturday, June 22, 2024

“No sign of promised recovery”: Opp as India’s GDP growth slows for third straight quarter

India’s economic growth slowed to the lowest in a year in the first three months of 2022.

Gross domestic product grew 4.1 percent year-on-year in January-March, government data released on Tuesday showed.

The slowdown meant that the fourth quarter of 2021-22 (January-March 2022) saw the lowest growth after 20.1 per cent in the first quarter (April-June 2021), 8.4 per cent in Q2 and 5.4 per cent in Q3.

The Indian economy slowed down for the third straight quarter.

The economy’s near-term prospects have darkened due to a spike in retail inflation, which hit an eight-year high of 7.8 percent in April.

The surge in energy and commodity prices is also squeezing economic activity, analysts say.

“Inflation pressures will remain elevated,” V Anantha Nageswaran, chief economic adviser at the finance ministry, said after the data release, adding that the risk of stagflation – a combination of slow growth and high inflation – was low in India.

During the fourth quarter of 2021-22 (January-March 2022), agriculture grew at a pacy 4.1 per cent but manufacturing contracted 0.2 per cent. The services sector- trade, hotels, transport and communication expanded by 5.3 per cent while the financial services and real estate sector grew by 4.3 per cent. Public administration, defence and other services, which represent government expenditure, grew 7.7 per cent during the March quarter. Mining and quarrying grew 6.7 per cent and construction lumbered ahead by 2 per cent.

Congress, the key Opposition expressed concern over “no sign of promised” recovery after the National Statistical Officer (NSO) provisional estimates put India’s GDP growth for the last quarter of the financial year 2021-22 at 4.1%.

The former Union minister and senior Congress leader P Chidambaram said that the “most striking graph” of the NSO estimates is the quarterly growth rate of the last financial year, which shows a downward trend.

Chidambaram said the quarterly figures show that the growth rate is “weakening every quarter” with “no sign of the promised ‘recovery’.”

“The NSO figures are out: the most striking graph is the quarterly growth rates in 2021-22 of 20.1, 8.4, 5.4 and 4.1 per cent,” the Congress leader wrote on Twitter.

“That graph tells all. The growth rate is weakening with every quarter and there is no sign of the promised ‘recovery’,” he added.

Chidambaram also noted that India’s economic growth in 2021-22 was “barely above the level achieved in” 2019-20.

“That means that after…two years, India’s Economy is at about the same level as it was on 31-3-2020,” he tweeted.

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