India's economy on path of gradual recovery: Economists

Economists are in concurrence that the Indian economy is on a recovery mode. However, downside risks till persist. There is still uncertainty around domestic demand, capital expenditure (capex) by state governments, non-performing assets (NPAs) of the banking sector and supply-side constraints, they added. Speaking at the Business Standard’s BFSI Insight Summit, Nomura’s chief economist for India and Asia ex-Japan Sonal Varma stated that there has been a very uneven recovery and the real GDP is still 10 per cent down, compared to the pre-pandemic period. JP Morgan’s chief India economist Sajjid Z Chinoy is of the view that if the economy grows by 9-9.5 per cent in the current fiscal year, it will still be below pre-pandemic levels of income. Deutsche Bank AG’s chief India economist Kaushik Das stated that if there is no third wave, the economy could still grow by 10-10.5 per cent this fiscal year. ICRA’s chief economist Adity Nayar has revised India’s real GDP growth projection for 2021-22 to nine per cent from 8.5 per cent. State Bank of India (SBI)’s group chief economic advisor Soumya Kanti Ghosh believes that private final consumption will continue to remain a challenge since the second wave impacted household savings.