What is this advance estimate of GDP and how are the various sectors likely to grow this year?

The MOSPI puts out two advance estimates for full year GDP; once in the first week of January and once on the last day of February along with the announcement of the third quarter GDP. The quarterly GDP is announced after 2 months from the end of the quarter. The first advance estimate for GDP for FY22 has been put out by the MOSPI on 07-January, pegging the full year GDP growth at 9.2%.

Normally, MOSPI presents the data on GVA (gross value added) by specific sector. Here are some of the highlights of the GVA break up provided. GVA is GDP excluding taxes and subsidies and is estimated to grow at 8.6% in FY22. Here is how the GVA breaks up.

· Agriculture and forestry has grown 3.9% over last year and 7.7% over FY20. This is one segment that has seen positive growth through the pandemic.

· An extension of agriculture is mining and quarrying which was also up 12.5% on a yoy basis and 4% higher on a 2-year basis over pre-COVID levels.

· Among other key sectors, Construction will grow by 1.2% over FY20 while the power utilities will grow by 10.6% over FY20.

· It looks like manufacturing is getting into shape growing by 12.5% over previous year and by 4.4% over the pre-COVID levels.

· Among services while public services were robust, Financial services and realty grew by just about 2.5% on a two year basis.

· The one segment to lag was trade, hotels and transport. Despite a 11.9% growth over last year, it is still 8.5% below the pre-COVID levels showing the extent of covid damage.

There is pressure on the high contact businesses but the good news is that manufacturing is finally on track.