India is on the way to achieving the fastest growth rates of the economy, going by overtaking the whole world, as evidenced by the indicators of the country’s internal gross product (GDP). Reports about it Bloomberg.
Indian GDP grew by 20.1 percent in the second quarter compared to last year, which does not match the forecasts of economists who expected an increase of 21 percent. The report of the Ministry of Statistics and Programs has shown that in the second quarter, growth was observed in different sectors of the economy. In trade, hotel and transport sectors, it amounted to 34.3 percent, in construction – 68.3 percent. The agro-industrial complex rose by 4.5 percent, industrial – by 49.6 percent. Indian rupee has grown to peak values since May, and stock indices reached a new maximum.
Economic growth has been preserved at a level of 9.2 percent on the forecast of GDP for 2021, becoming the fastest among large economies, exceeding the mark of 8.5 percent of China’s growth. High rates of vaccination from Coronavirus allowed people to lead a familiar lifestyle and reduce the damage in the service sector, and the production indicators were higher than expected, which contributed to the record growth rates.
The influence of the constraints caused by a pandemic was less serious than in 2020, which made it possible to quickly restore the demand in the economy. As shown by the data of the Reserve Bank of India, in July loans for consumer goods for long-term use, buying cars, real estate and small businesses have increased both in a monthly and annual calculus. The leaders of enterprises in July noted the increase in the number of new orders, a similar survey of purchasing managers in the service sector showed that the sector gradually expands, which only confirms the availability of demand. In addition, exports to which there is almost a fifth part of the economy, grew over the past eight months, which indicates high global demand.
The threat of the third Pandemic wave did not allow the central bank of the country to minimize its monetary policy with record low interest rates that were introduced to support the economy. Prime Minister of Narendra Moi plans to supplement monetary stimulation with fiscal measures. The government intends to collect 6 trillions of rupees (81.9 billion dollars) due to the rental of state infrastructure over the next four years to finance new costs without further increasing budget deficit.