India to grow at 11.5 pc in FY 21-22, predicts Economic Survey

The bounce back following nationwide vaccine drive comes after an estimated 7.7 per cent pandemic-driven contraction in 2020-21.

"Real growth rate for FY21 is taken as -7.7 per cent (MoSPI) and real growth rate for FY22 is assumed as 11.5 per cent," the survey said.

This projection is in line with the forecasts by the Reserve Bank of India and international agencies like the IMF.

Last month, the RBI had said it expected the country's GDP to contract 7.5 per cent in the year ending 31 March, 2021.

The Survey predicted a "V-shaped" recovery for the economy, "with a stable macroeconomic situation aided by a stable currency, comfortable current account, burgeoning forex reserves, and encouraging signs in the manufacturing sector output."

The survey sees headline inflation moderating going forward.

With the economy returning to normalcy, hopes of a robust recovery in services sector, consumption, and investment have been rekindled, said the survey.

The survey, however, cautioned that it would take at least two years to revert to pre-pandemic gross domestic levels.

Indian economy contracted by a massive 23.9 percent year-on-year (YoY) in the April-June quarter. This was the first GDP contraction in more than 40 years. For the July-September quarter, India's GDP contracted 7.5 percent year-on-year, as per estimates released by the National Statistical Office.