India's Q2Fy22 GDP data revealed today has come in higher than estimates at 8.4 percent. In the same quarter last year the figure came in at -7.4% in the backdrop of the economic disruption caused due to the coronavirus pandemic. Nevertheless as the economy gradually opened up and because of low base effect, in the Q1 period of Fy22, Indian economy grew at a record rate of 20.1 percent.
GVA or Gross value added on the other hand for the review period i.e. quarter ended September of Fy22 grew by 8.5 percent as against a contraction of 7.3 percent in the corresponding quarter during a year ago period. The GVA in the previous quarter logged a sharp surge of over 18 percent.
Notably, GVA plus taxes minus subsidies is GDP.
Another notable point worth mentioning is that the PFCE or private final consumption expenditure which is a major component of overall GDP number logged a rise of 8.61 percent YoY.
So, as we see remarkable recovery in economy's growth which shall open up new employment opportunities:
Here's what various experts make of the GDP Q2Fy22 data
Mr. Nish Bhatt, Founder & CEO, Millwood Kane International on the data says " The Q2 GDP data at 8.4% is in line with most estimates, this pegs the H1FY22 growth at 13.7%. The recovery has been broad-based with most components contributing to growth. Mining, construction, real estate showed considerable growth. A good monsoon year reflected well with high agricultural output.
Private consumption is likely to pick up as we near complete normalization. The private capex will likely catch up with government spending and aid growth further.
The data will have a positive bearing on the RBI's MPC meeting next week. The low interest, excess liquidity policy is paying good results. Going forward, the way countries across the globe handle the new variant of the pandemic, rising inflation, and movement of crude price will have an impact on the growth rate across the globe."
Senior Economist-HDFC Bank said "The GDP growth for Q2 at 8.4% confirms that the economy gained traction in the second quarter. On the supply side, agriculture growth provided support, along with a pick-up in service sector growth at 10.2% as contact-intensive services improved along with financial and real estate sectors".
While Elara Capital's Garima Kapoor told Reuters that the GDP numbers for the Q2 came in partly lower than anticipated. ".....led by disappointment in recovery of industrial sector, mainly manufacturing. Impressive momentum of vaccination, releasing of the pent up demand mainly in services sector, nascent uptick in private investment appetite and accelerated momentum of government spending in H2FY22 will remain supportive hereon, even as elevated inflation and weak rural sentiments are emerging as risks on the horizon," she added.
"India's real GDP grew 8.4% YoY in 2QFY22/3QCY21, marginally better than our/market forecast. A comparison of India vis-a-vis other major nations reveals that while 3QCY21 growth is the highest in India, it is right in the middle - almost flat - on 2-yr CAGR basis.
GDP details suggest that while Private consumption grew slowly than expected, investments grew slightly higher.
From GVA perspective, while farm, construction and public administration & defense services (PADS) grew faster than expected, it was partly offset by weak manufacturing sector. The sharp improvements in the farm and PADS sectors were the surprise in today's release, which pushed real GVA growth higher than expected.
Nevertheless, the broad story remains intact. With weak household sector, consumption may continue to lag. Accordingly, we believe that real GDP growth could be 5-5.5% in 2HFY22, implying full-year FY22 growth of ~9% or just 1% higher than in FY20", perspective on Q2 GDP data by Mr. Nikhil Gupta, Chief Economist at Motilal Oswal Financial Services.