The National Statistical Organisation (NSO) expects the GDP to come in -7.7 and that was the CNBC-TV18 poll as well. In this special segment Budget Brainstorm, Neelkanth Mishra, Managing Director and India Equity Strategist at Credit Suisse, and Sonal Varma, Chief Economist at Nomura India discuss these big macros numbers.

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Nomura India’s Sonal Varma said, “GDP numbers look like they are going to be even higher than what you are suggesting. In terms of the normal GDP itself given the faster pace of economic normalisation in India and continued improvement in the real economy because of easier financial conditions we have revised our growth numbers.”

Varma also said that the advance estimates for FY21 will get advised higher

“For FY21 we are now looking for minus 6.7 percent, we do think that the advanced estimates will get revised higher. As we look out into FY22 our expectation is that real GDP itself could drive by over 13 percent.”

Credit Suisse’s Mishra said, “The numbers for both FY22 and FY21 should be higher than where the consensus is right now. The better measure in my view is to look at FY22 over FY20 and also assume FY20 itself was not fully normal. I do think that 17-18 percent kind of normal GDP growth is what will eventually come about. But I am also aware that the government will not go that kind of a number because the government is likely to be a lot more conservative therefore the number that we see is going to be more in the 12-13 percent range could be my prediction.”

On FY22 spending, Nomura’s Varma said, “The spending will need to be a lot more frontloaded even in FY22. It needs to be a lot more targeted. As we look forward the allocations need to be a lot more around health and vaccine-related cost, it needs to be on infrastructure kind of spending.”

Watch the video for more

(Edited by : Ajay Vaishnav)

First Published:Jan 8, 2021 1:34 PM IST