Prof Mithilesh Kumar Sinha
Nagaland University, Lumami
As the World including India gave farewell another pandemic-ridden year 2021 it is my responsibility being a student of Economics to review how the Indian economy has performed in 2021. The Indian economy showed signs of recovery amid uncertainty in 2021.
The second wave of Covid-19
As such, at the start of 2021, it was hoped that India’s growth recovery would start to gather momentum. At that time, the concerns about Covid-19 had also taken a back seat. But a second Covid wave upset all calculations.
GDP Numbers on an Upward Trend
After registering the sharpest contraction of 7.3% in 2020-21, the country’s gross domestic product (GDP) expanded at 20.1% year-on-year in the June quarter of the financial year 2022; the figure was 8.4% for the September quarter.
India’s Trade on resilience
According to United Nations data India is one of the few countries that has performed better than major economies in the world in terms of trade in the first quarter of 2021. While the import of goods grew by 45% in the first quarter over the year 2021, exports grew by 26%. Overall, India’s exports in April 2021 were recorded at $30.63 billion, as compared to $10.36 billion in April 2020, exhibiting a growth of 195.72%. Even after the second COVID-19 wave hit the country, India’s merchandise trade has shown resilience. Exports rose in June 2021 by 48.3 per cent to $32.5 billion compared to June 2020. India’s merchandise exports increased for the twelfth consecutive month in November and grew 26.49% this year at $29.88 billion.
Unemployment
High unemployment in 2021 was the biggest challenge faced India. The overall unemployment levels rose again from 7.97% in April to 9.17% in June, according to Centre for Monitoring Indian Economy (CMIE) data, after several states-imposed lockdowns to control the covid-19 second wave. With the economic recovery, by November, employment nationwide had improved to 7.00%, that is pre-second wave levels.
Inflation: Fluctuating indicator
Inflation has been big worry for Indians in 2021. As per inflation data released by the Ministry of Statistics and Programme Implementation India’s benchmark inflation rate, measured by the Consumer Price Index (CPI), firmed up to 4.91% year-on-year in November. Food expenditure makes up 40% of an average Indian household’s budget. Wholesale prices surged to a 12-year high of 14.23%, and that is worrisome.
GST numbers show economy on upswing
India's gross GST (Goods and Services Tax) revenue collected in November 2021 stood at Rs 1,31,526 crore, second-highest ever since the introduction of GST. It was at Rs 1.39 lakh crore in April 2021. The GST collection remained above the 1-lakh crore mark in every month since July this year, highlighting that the economic recovery is on a firm ground.
Vaccination campaign
In January 2021, ambitious vaccination campaign was begun in India against COVID-19, one of the largest in the world. Starting with healthcare workers and frontline workers, the vaccination programme was gradually opened for all adults in the country. As of December 29 (Wednesday) morning, over 143 crore doses of vaccines have been administered in India. The success of the vaccination campaign removed all the doubts about the country's capability to manufacture and administer the vaccines, and also helped in resumption of economic activities.
It is hoped that year 2022 will witness a robust economic condition.
Year 2022may be called the year of hope
Best wishes for a happy, healthy and prosperous 2022
