RBI is revising the growth rate estimates due to the second wave of Kovid, said this in the annual report
Reserve Bank of India Has said Kovid-19 Epidemic For the current financial year 2021-22 among the second wave of Growth rate projections Amendments are being made to The central bank’s annual report for 2020-21, released on Thursday, said that amid the amendments, there is an opinion that the growth rate in 2021-22 will be at its earlier estimate of 10.5 per cent.
The annual report says that last year has left a ‘wound’ on the economy. ‘The widespread disappointment among the second wave is being helped by the vaccination campaign to overcome the cautious expectation.’ The central bank said that with the second wave, a round of revisions in the growth rate projections has started. The consensus for 2021-22 seems to stick to the Reserve Bank’s earlier estimate of 10.5 per cent.
The growth rate is estimated to be 26.2 percent in the first quarter of the current fiscal, 8.3 percent in the second quarter, 5.4 percent in the third quarter and 6.2 percent in the fourth quarter. The report says that the epidemic is the biggest risk facing the scenario. There is scope for improvement in the economy due to increased investment by the government, higher capacity utilization and better capital goods imports.
The central bank believes that collective global efforts will surely lead to better results than individual countries’ struggle against the epidemic. The report says that the monetary policy stance in 2021-22 will depend on the macroeconomic situation. The policy will mainly support growth. The central bank said that the rate of infection in the second wave is quite worrisome. In the midst of such a rapid transition, the health infrastructure has to be expanded in terms of capacity.
The Reserve Bank said that in the event of further growth returning and the economy coming back on track, it will be important that the government follows a clear exit policy and creates fiscal buffers to be used in the event of future setbacks. The report states that the high cyclical signs for the beginning of April and May indicate a mixed picture. In April, the collection of Goods and Services Tax (GST) has crossed the Rs 1 lakh crore mark for the seventh consecutive month. This shows that manufacturing and service production are intact.
(This news has not been edited by the NDTV team. It has been published directly from the Syndicate feed.)