Economy seen to grow by 10% or more in FY22: Niti VC

Indian economy is expected to grow by 10 per cent or more in the current fiscal, and 8 per cent plus in the next fiscal year, Niti Aayog Vice-Chairman Rajiv Kumar said on Tuesday.

Addressing a book launch event, Kumar further said that seven years of the Modi government has laid a strong economic foundation for businesses to thrive in India.

"There was a hiccup (in economic growth) for two years due to COVID-19 pandemic.

"The IMF has projected a growth of 9.5 per cent in 2021.

"According to the IMF, India will be the fastest growing major economy for the next five years. These are underestimations," Kumar said.

The Reserve Bank of India (RBI) has lowered the growth projection for the current financial year to 9.5 per cent from 10.5 per cent estimated earlier while the IMF has projected a growth of 9.5 per cent in 2021 and 8.5 per cent in the next year.

"India will grow at 10 per cent plus in the current fiscal year (2021-22).

"And going forward, once we are out of the COVID-19 pandemic, we (Indian economy)  will grow at 8 per cent plus in FY 2022-23," Kumar said.

"Things are changing and people are ready to invest in India," he said.

The Niti Aayog Vice-Chairman said the potential rate of growth of India will move up to 8 per cent.

Last month, the International Monetary Fund (IMF) had revised India's potential growth forecast downwards to 6 per cent citing the pandemic.

Potential growth is the rate of growth that an economy can sustain over the medium term without generating excess inflation.

The country's economy grew by a record 20.1 per cent in the April-June quarter, helped by a very weak base of last year and a sharp rebound in the manufacturing and services sectors in spite of the devastating second COVID wave.

Kumar said Indians are now getting better quality jobs.

The Niti Aayog vice-chairman said over the last 18 months,  CMIE (Centre for Monitoring Indian Economy) data has shown improvement in job creation, while EPFO and PLFS data have shown new job creation.

Kumar, however, admitted that jobs may not be coming at the rate "we are wanting".

He said in seven years of the Modi government, 485 government schemes have been brought under Direct Benefit Transfer(DBT).

"Rs 5.72 lakh crore have been transferred through DBT," Kumar said.

Kumar said the gestation period of reforms in India was 7 years.

"The  (gestation) period has been brought down during the Modi government period," he noted.