“The pandemic impacted the country, but the recovery has been faster than the damage.” Prime Minister Narendra Modi said on Saturday. “Covid-19 had an impact on economies all across the world, including India’s. But our economy has made a strong comeback,” Modi remarked at the Sardardham Bhavan’s opening in Ahmedabad.
The Prime Minister remarked that India was reforming at a time when the world’s major economies were on the defensive. “When global supply chains were interrupted, we launched PLI (production linked incentive) plans to help India turn the tide,” the Prime Minister remarked. He believes that the recently introduced PLI in textiles will be extremely beneficial to towns like Surat.
“In the twenty-first century, we should regard ourselves as global economic leaders. There are plenty of opportunities for India to succeed,” remarked the Prime Minister.
Prepared for third pandemic wave
The economy has continued to recover from the pandemic, according to the latest figures, as restrictions have been loosened across the country. The economy expanded by 20.1 percent in the April-June quarter of the current fiscal year, which ends in March, and several major indications point to a strong recovery in the coming quarters. Industrial output in July was virtually back to pre-pandemic levels, according to data released on Friday, with an annual increase of 11.5 percent.
According to experts, the economy will grow by double digits in 2021-22, and the finance ministry has stated that rapidly expanding vaccine coverage and more expertise with pandemic management provide confidence that the recovery will continue even if a third wave occurs.
Meanwhile, the Union cabinet recently approved a Rs 10,683 crore PLI programme for the textile industry, with the government hoping to attract considerable investment and new jobs. The PLI scheme, which includes ten industries including textiles and autos, aims to attract investments, create jobs, and increase economic growth in addition to assisting the ongoing economic recovery.
Amidst virus outbreak obstacles, there are signs of rebound
The Indian economy is showing signs of recovery as the country’s festival season begins, which normally boosts consumer-dependent industries. However, analysts warn there is still a long way to go for a full recovery, and risks persist as a result of fears of another pandemic outbreak. While there are signs of recovery in some areas of the economy, we cannot be convinced that the worst is behind us for the economy as a whole.
According to the most recent government figures, India’s gross domestic product increased by 20.1 percent in the April-June quarter. This compares to a low base in 2020, when the country enforced one of the world’s tightest statewide lockdowns in reaction to the pandemic, causing the country to enter a recession.
Despite the fact that India was dealing with a devastating second wave of pandemic infections earlier this year, state governments were obliged to implement local lockdowns, and the GDP grew. However, economic activity was not as impeded as it had been the previous year.
S&P Global, a ratings firm, predicted that India’s economic growth would be high in the next quarters. It does, however, caution that inflation is expected to continue high. It also stated that during the next 24 months, the rate of recovery will decide its next grading action. India is expected to grow at a rate of 9.5 percent this fiscal year, according to S&P.
In the recent several months, high frequency important economic indicators such as GST (goods and services tax) collection, railway freight, vehicle sales, electricity consumption, and import-export data have all indicated a sustained economic improvement on a year-over-year basis.
Frequently Asked Questions
What does it mean to be economically recovered?
Following a recession, economic recovery entails reallocating resources and personnel from failed enterprises and investments to new jobs and uses, among others. After the recession, the economy recovers and enters a new expansionary business cycle phase.
What are the 4 stages of an economic cycle?
The 4 stages of an economic cycle are contraction, expansion, trough and peak. The economy is in an expansionary phase when it grows for two or more quarters in a row. Interest rates are often lower, employment rates are growing, and consumer confidence is increasing.