India's GDP to rise 9.2% in FY 2021-22 as against 7.3% contraction in previous fiscal: First advance estimates

New Delhi, Jan 7: The Indian economy is estimated to grow at 9.2 per cent in 2021-22, as against a contraction of 7.3 per cent in the previous fiscal, mainly due to improvement in the performance of agriculture and manufacturing sectors, the National Statistical Office (NSO) said on Friday.

Releasing the first advance estimates of National Income for 2021-22, the NSO stated, "The growth in real GDP during 2021-22 is estimated at 9.2 per cent as compared to the contraction of 7.3 per cent in 2020-21."

"Real GVA at Basic Prices is estimated at Rs 135.22 lakh-crore in 2021-22, as against Rs 124.53 lakh-crore in 2020-21, showing a growth of 8.6 per cent," it added.

"However, these are early projections for 2021-22. Actual performance of various indicators, actual tax collections and expenditure incurred on subsidies in the following months, fresh relief measures for the vulnerable sections (such as providing free food grains which has now been extended till March 2022) and other measures, if any, taken by the Government to contain the spread of Covid-19 would have a bearing on subsequent revisions of these estimates," the press release from the the NSO read.

The growth in nominal GDP during 2021-22 is estimated at 17.6 per cent. Nominal GVA at Basic Prices is estimated at Rs 210.37 lakh crore in 2021-22, as against Rs 179.15 lakh crore in 2020-21, showing a growth of 17.4 percent.

Nominal GDP or GDP at Current Prices in the year 2021-22 is estimated at Rs 232.15 lakh crore, as against the Provisional Estimate of GDP for the year 2020-21 of Rs 197.46 lakh crore, released on May 31, 2021. Actual figure for the first half of the current year has been officially released. The GDP expanded by 20.1 per cent during the first quarter of the current financial year while it grew by 8.4 per cent in the July-September 2021 quarter.

This is the First Advance Estimate of National Income for the financial year 2021-22. It was introduced in 2016-17 to serve as essential inputs to the Budget exercise. "It is based on limited data and compiled using the Benchmark-Indicator method i.e. the estimates available for the previous year (2020-21 in this case) are extrapolated using relevant indicators reflecting the performance of sectors," the National Statistical Office (NSO) said.

The sector-wise estimates have been compiled using indicators like (i) Index of Industrial Production (IIP) of first 7 months of the financial year, (ii) financial performance of Listed Companies in the Private Corporate sector available upto quarter ending September, 2021 (iii) 1st Advance Estimates of Crop production, (iv) Accounts of Central & State Governments, (v) Bank Deposits & Credits, (vi) Net Tonne Kilometres and Passenger Kilometres for Railways, (vii) Passengers and Cargo handled by Civil Aviation, (viii) Cargo handled at Major Sea Ports, (ix) Sales of Commercial Vehicles, etc., available for first 8 months of the financial year. Projections for 2021-22 for passengers and cargo handled by civil aviation, cargo handled at major sea ports made available by the concerned agencies were also made use of in compilation of estimates of respective sectors, the NSO added.

The total tax revenue used for GDP compilation includes non-GST revenue and GST revenue. The Budget Estimates of tax revenue for 2021-22, as available on Controller General of Accounts (CGA) and Comptroller and Auditor General of India (CAG) websites have been used for estimating taxes on products at current prices. For compiling taxes on products at constant prices, volume extrapolation is done using volume growth of taxed goods and services. The total product subsidies were compiled using the latest information on major subsidies like Food, Urea, Petroleum and Nutrient based subsidy as available on CGA website and the expenditure incurred on subsidies by most States upto October 2021 as available on CAG website along with the Centre/State-wise BE provision for 2021-22.

Information available on Revenue expenditure, Interest payments, Subsidies etc. based on detailed analysis of budget documents of Centre and States for 2021-22 were also put to use for estimating Government Final Consumption Expenditure (GFCE), the statement said.