Morgan Stanley maintains India GDP growth estimate of 10.5 pc for FY22

Mumbai (Maharashtra) [India], Sep 1 : Morgan Stanley on Wednesday maintained its estimate of India GDP growth at 10.5 per cent for FY2022 versus the general consensus of 9.2 per cent.
"We expect economic activity to start normalising from quarter ending September, supported by pent-up demand, ramp-up of the vaccination drive (which is picking up pace and tracking at an average of 7 million per day), favourable policy mix and robust global growth," it said in a research report.
GDP growth is expected to move into positive territory on a two-year CAGR basis from QE September.
However, said Morgan Stanley, key risks to watch are the pace of vaccination (any slowdown could increase risks) and the trend in Covid-19 cases -- potential re-acceleration, threat from new variants and restrictions on activity.
GDP grew 20.1 per cent year-on-year in the quarter ending June. On a two-year CAGR basis, real GDP contracted 4.7 per cent in QE June versus plus 2.3 per cent in QE March.
On a seasonally adjusted sequential basis, GDP declined 6.3 per cent, reflecting the impact of restrictions on activity as the second wave surged during April and May.
On the demand side, private consumption and fixed capital formation declined on a two-year CAGR basis while government consumption and exports rose.