Commenting on the GDP numbers released yesterday Uday Shankar, President, FICCI said, “The GDP growth numbers both for the fourth quarter and for the full fiscal year 2020-21 have been a little better than anticipated reflecting recovery gaining traction during Jan-March quarter. The pickup in manufacturing, electricity and construction sectors is particularly telling.”
“However, we must note that the sharp economic turnaround that India was witnessing earlier this year has been suddenly interrupted due to the devastating second wave of the COVID-19. FICCI is particularly concerned about the spread of the second wave to the rural areas and smaller towns. Almost all the lead recovery indicators have been undermined once again over the past few weeks,” he added.
“Moreover, even though there was a limited impact on the supply side this year, it is the demand which has taken a greater hit. In fact, our latest Business Confidence Survey released yesterday has once again revealed weak demand arising as a major challenge for businesses. Unlike last time, when households fell back on their savings and helped in quick economic recovery with pent-up demand, this time, savings are depleted as health expenditure has been quite high. Also, there has been permanent impairment to income for many. We feel that there is an urgent need for boosting demand through Direct Income Support measures. Focus on urban poor, security cover for MSMEs and other high contact-based services will be critical,” added Shankar
“Going ahead, it will be important to continue working on a war footing strategizing for the third wave. Vaccination remains the key to return to normalcy and all levers must be pulled on that front. While production is being ramped up, putting in place logistics for large scale distribution and administering of vaccines with precision will be equally important. India’s Election Commission has proven its merit in conducting electoral polls in such a diverse country and some learnings from their experience can be drawn and adopted for vaccination as well,” further said Uday Shankar.