ICRA Projected India’s GDP Growth in FY22 at 8.5%

The Information and Credit Rating Agency of India Limited (ICRA), projected India’s gross domestic product (GDP) growth in FY22 at 8.5 percent due to decline in COVID-19 cases and easing of restrictions.

  • It forecasted the gross value added (GVA) at basic prices (at constant 2011-12 prices) to grow at 7.3 percent in FY22.
  • In case of accelerated vaccine coverage, ICRA expects India’s GDP expansion in FY22 to 9.5 percent, with a widening upside in Q3 and Q4 of FY22.
  • The agency expects the nominal GDP to expand by 15-16 percent in FY22 and the CPI and WPI inflation to average 5.2 percent and 9.2 percent.

Key points about ICRA Projections:

i.In FY22, it expects the GDP growth to exceed the GVA growth by 120 basis points (bps), based on the expectations related to the value of taxes on products and subsidies on products.

ii.Following the decision taken by the government to provide free food grains in May-November 2021, The agency has taken into account the higher outgo towards food subsidies by the government in FY22, relative to the budgeted level.

iii.Hence the FY22 quarterly GDP growth has been modified by it to 14.9 percent in Q1, 8 percent in Q2, 5.6 percent in Q3, and 7 percent in Q4.

Note – In its 2nd bi-monthly monetary policy report (June 2021), the Reserve Bank of India(RBI) projected India’s FY22 GDP growth at 9.5 percent with contraction of 7.3 percent in FY21.

Recent Related News:

On April 20, 2021, the Information and Credit Rating Agency of India Limited (ICRA) reduced India’s GDP growth forecast for FY22 by 0.5 per cent i.e. projected growth to a range of 10-10.5 per cent, against 10-11 per cent of its earlier estimation due to the surge in COVID-19 cases and the localized restrictions.

About Information and Credit Rating Agency of India Limited (ICRA):

It is owned by Moody’s Corporation

Establishment – 1991
Headquarters – New Delhi
MD & Group CEO – Mr. N. Sivaraman





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