Recalibrate growth, reprioritise expenditures Updated: Updated: May 24, 2021 00:51 IST Protecting total expenditures at the budgeted level and mass vaccination are important in India’s pandemic situation Share Article AAA Protecting total expenditures at the budgeted level and mass vaccination are important in India’s pandemic situation The second wave of COVID-19 currently sweeping India is forcing States into successive lockdowns, in turn eroding economic activities. The growth projections of different national and international agencies and the fiscal projections of Centre’s 2021-22 Budget require recalibration. COVID-19-induced erosion The International Monetary Fund (IMF), the Reserve Bank of India (RBI), and the Ministry of Finance’s Economic Survey had forecast real GDP growth for 2021-22 at 12.5%, 10.5%, and 11.0%, respectively. Moody’s has recently projected India’s GDP growth in 2021-22 at 9.3%. This is close to the benchmark growth rate of 8.7% which would keep India’s GDP at 2011-12 prices at the same level as in 2019-20. This level of growth may be achieved based on the assumption that the economy normalises in the second half of the fiscal year. If the lockdowns come to an end earlier, the growth rate may be higher, but that is perhaps unlikely.