Sanjay Aggarwal, President, PHD Chamber has appreciated an improvement in GDP in Q2 at (-)7.5% from (-) 23.9% in Q1 2020-21.
Meaningful reforms undertaken the by the Government since March 2020 are really appreciable which have given the direction to the economy to come back on track, said Shri Sanjay Aggarwal in a press statement issued here today.
The Q2 GDP has contracted by (-)7.5% due to decline in the growth rate of financial, real estate & professional services at (-)8.1% and public administration, defence & other services at (-)12.2%, mining & quarrying at (-)9.1%, manufacturing at 0.6%, electricity, gas, water supply & other utility services at + 4.4%, construction at (-)8.6%, trade, hotels, transport, communications & services related to broadcasting at (-)15.6%. The growth rate of agriculture, forestry & fishing has been consistent at + 3.4%.
Going ahead, the Government’s focus on demand rejuvenating measures introduced under Aatmanirbhar Bharat 3.0 will have a multiplier effect on the economic growth trajectory through enhanced demand, job creation, increased private investments, escalated exports and growth of sectors that have strong backward and forward linkages in the coming quarters, said Sh. Sanjay Aggarwal
The recent reforms announced by the Government such as Production Linked Incentive Scheme for 10 champion sectors, Central Government’s contribution of 24% of EPF wages (12%+12%) for establishments having upto 1000 employees and 12% (employee part) of EPF for establishments having more than 1000 employees for 2 years, income tax relief to developers and home buyers, among others, have potential to push the GDP growth in the positive trajectory of 0.1% to 2% in the Q3 FY 2020-21 and 2% to 4% in the Q4 FY 2020-21, said Mr. Sanjay Aggarwal.
The recovery in the key economic and business indicators on the back of a series of stimulus announcements by the Government in last 8 months, totalling to around Rs 29.9 lakh crore, will go a long way in our fight against the pandemic impact of COVID-19 on trade, industry and economy, said Shri Sanjay Aggarwal.
The economic reforms undertaken by the Government have instilled the expectations of a strong, sustainable and even positive growth in Q3 FY2021 with robust resumption of the lost economic activity, said Shri Sanjay Aggarwal.
Provision of Rs 1.46 lakh crore under Production Linked Incentive Scheme for 10 champion sectors will help link India to global value chains, encourage exports, give companies a competitive edge in the global market and make India a global manufacturing hub in the coming times, said Shri Sanjay Aggarwal.
The series of stimulus announcements by the Government under the AatnmaNirbhar Bharat Abhiyaan 1.0, 2.0 and 3.0 along with the measures undertaken by the RBI has taken the total of stimulus package to the level of around Rs 30 lakh crores, said Mr. Sanjay Aggarwal.
Reforms such as emergency credit line for MSMEs, liquidity scheme and partial credit guarantee scheme 2.0 for NBFCs, extension of the credit linked subsidy scheme (CLSS) scheme till March 2021, structural reforms in growth promising sectors including coal, minerals, defence, airports and aerospace management, power, space sector, atomic energy sector and civil aviation, six months moratorium on term loans, among others, have made recovery sooner than expected, said Mr. Sanjay Aggarwal.
Demand creation along with increased spending on infrastructure will have multiplier effects on the economic growth trajectory by boosting private investments, creating new employment opportunities in the country, generating demand for commodities such as steel, cement and power, said Shri Sanjay Aggarwal.
The planned Rs 111 lakh crore investment in the National Infrastructure Pipeline (NIP) has a great potential to boost the GDP growth of the country as correlation between the investment in infrastructure and economic growth is quite high, said Shri Aggarwal.