India's GDP Will Grow At 10.5% In FY22, Says RBI Governor

India's GDP Will Grow At 10.5% In FY22, Says RBI Governor
The RBI Governor Shaktikanta Das-led MPC kept the repo rate unchanged at 4 per cent
  1. The GDP will grow in the range of 26.2 to 8.3 per cent in the first half, and six per cent in the third quarter, RBI Governor Shaktikanta Das said.
  2. The RBI Governor highlighted the fact that recovery has strengthened since the last MPC meeting, economic growth is likely to pick pace and outlook for inflation is stable.
  3. The Budget has introduced several measures to provide an impetus to growth and the projected increase in capital expenditure augurs well for capacity creation, he added.
  4. The central bank's growth projection is still below that of Economic Survey and the International Monetary Fund (IMF).
  5. The Economic Survey had predicted a "V-shaped" recovery, saying that the Indian economy will rebound, with 11 per cent growth, in the next financial year. And IMF had said that India would grow at 11.5 per cent in 2021.
  6. Meanwhile, the RBI Governor Shaktikanta Das-led Monetary Policy Committee (MPC) decided to keep the repo rate unchanged at 4 per cent and the reverse repo rate untouched at 3.35 per cent.
  7. The central bank had last cut its policy rate on May 22, 2020, in an off-policy cycle, when Covid-19 posed an unprecedented challenge to the economy. Since then, the banking regulator has maintained status quo on rates.
  8. The Reserve Bank has kept the repo rate - the key interest rate at which it lends money to commercial banks - steady at a 19-year low of 4 per cent. The reverse repo rate - the rate at which the RBI borrows from banks - is at 3.35 per cent.
  9. India was among the major economies hit hardest by the pandemic, suffering the worst contraction in the June quarter. But a pick-up in manufacturing resulted in a much smaller contraction in the September quarter.
  10.  A pick-up in manufacturing and roll-out of the immunisation campaign has reduced some of the pessimism surrounding the economy.
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