India's GDP to grow at 9.1% in FY22; RBI to maintain status quo on repo rate: FICCI

Federation of Indian Chambers of Commerce & Industry (FICCI) in its latest Economic Outlook Survey has projected India's GDP in FY22 to grow at 9.1 per cent. This signifies a borderline improvement from the growth projection of the previous survey round held in July 2021, which stood at 9 per cent.  

"Economic recovery, post the second wave of the pandemic, seems to be holding ground and the same is also reflected in the incoming data on various high frequency indicators. The forthcoming festive season should support this momentum," said FICCI.  

As per FICCI, the median growth forecast for agriculture and allied activities has been pegged at 3.2 per cent for FY22. It expects the growth expectations of the agriculture sector to remain positive following the pickup in monsoon rains in the latter part of the season and subsequent increase in kharif acreage. On the other hand, the industry and services sectors are projected to grow by 12.9 per cent and 8.6 per cent respectively during the same period.  

Leading economists who participated in the survey are of the collective opinion that the Reserve Bank of India (RBI) will maintain status quo on the repo rate and will continue with an accommodative stance in the forthcoming monetary policy. The RBI's Monetary Policy Committee (MPC) meeting led by Governor Shaktikanta Das is currently underway. It will conclude tomorrow after which Das will announce the final decisions taken by the apex bank.

"Growth remains a clear priority for the Central Bank and the same has been clearly communicated in the past rounds of monetary policy announcements," said the industry body. It also added that inflation, which was a cause of major concern has relaxed over the last couple of months and overall. It expects an accommodative stance to be widely maintained over the near term. FICCI also pointed that maintaining adequate liquidity would remain imperative going ahead even as the RBI moves towards normalization.  

FICCI has put the median forecast for CPI-based inflation rate at 5.6 per cent for 2021-22, with a minimum and maximum range of 5.4 per cent and 5.8 per cent respectively. Retail prices are projected to ease slightly in Q3 2021-22.

Edited by Akashdeep Baruah

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