Q4 GDP numbers: Carving FY22 recovery amidst Covid setbacks

Indeed, while FY21 GDP reinforces the sharp slowdown in growth in a pandemic year, it also offers a low base for a mechanical bounce in FY22 recovery

India’s Q4 GDP is reminiscent of the growth trend prior to second wave of COVID. Ground realities have sweepingly altered since then, with the health crisis nudging a sequential setback in growth momentum in Q1-FY22. Capturing this, our FY22 GDP growth stands revised lower by 150 bps at 10.0 per cent. But, a rear-view assessment of Q4 FY21 remains relevant for three reasons for it offers insights for FY22, as we argue below.

Pandemic new normal

Q4 FY21 GVA at 3.7 per centYoY is perhaps a sound verdict on how normal can economic activity get in a pandemic environment. Amidst low infections,