CII pegs GDP growth at 9.5% in FY22

New Delhi: The Gross Domestic Product (GDP) growth for the financial year of 2021-22 is expected to be at 9.5 percent, predicted the Confederation of Indian Industry (CII). The observatory body made economic projections for different sectors of the Indian economy amid ongoing second wave of Covid-19 pandemic.

The unprecedented surge in the Covid cases resulted in the footfall of demand which has hampered the performance growth of the Quarter 1 of FY 21-22. TV Narendran, president, CII, on Thursday said that the CII projects a stronger GDP recovery is likely for FY22 with a growth of 9.5 percent.

"This is line with most of the institutions. And strong growth in the second half will be supported by robust external demand and resumption of economic activity on the back of large-scale coverage of vaccination. However, even with this high rate of growth, the GDP will come back to where it was two years back or slightly higher," the newly appointed president of the chamber said. CII, on the announcement of economic projections, has suggested number of measures to bring relief to different sectors and speed up the immunization drive. Emphasising on the need to ramp-up the vaccination coverage and reduce vaccine hesitancy, the CII President has called for the appointment of a 'Vaccine Czar' to track domestic vaccine production and import supplies. He also observed that the unemployment rates have shot up to double digit levels in both rural and urban areas, further impacting livelihoods across the country. "The second wave has had a debilitating impact on livelihoods. The CMIE all-India unemployment rate has risen to a high of 11.9% in May 2021 from 8.0% in the previous month," he said.

The chamber has stated in its observatory report that, the growth rate can pick up to 8-9 percent, in the medium term, if positive actions are taken in the current scenario. A lower growth of a 5-6 percent growth scenario is also possible. To boost the economy towards an upward direction, the CII has offered suggestions including cash transfers to households through Jan Dhan accounts, higher MNREGA allocation from the budgeted amount, short-term and focused GST cuts to boost demand, time bound tax relief/interest subvention/stamp duty concession for home buyers and extension of the Atmanirbhar Bharat Rozgar Yojana till March 31, 2022.

"Fiscal stimulus of ₹3 lakh crore is required," said The CEO and Managing Director of Tata Steel Ltd, to boost the demand in the market. Narendran, who took charge of CII two weeks ago, also said that for MSMEs government needs to ensure timely payment along with timely clearance of dues to the industries.