NEW DELHI: India's Gross domestic product (GDP) growth rate for FY22 is expected to be in double digits on the back of the strong performance of country's tradables sector and a much smaller-than-expected decline in services activity due to pandemic disruptions this year, according to report by Barclays.

The report authored by Barclays chief India economist Rahul Bajoria has projected upside risks to its FY 2021- 22 GDP projection of 9.2 percent. The banker's projection on India's FY22 GDP is close to RBI's which had retained GDP forecast for the year at 9.5 percent. It also says,  that if all its forecast is realized, GDP growth could be close to double digits for the current fiscal year. "India's second COVID-19 wave acted as a stumbling block to the robust recovery that was underway. Still, the economic damage appears to be less than previously expected. With the second outbreak brought under control, a rapid recovery appears underway," Bajoria wrote in his report.

Based on this assessment, Barclays has forecast India's economy expanded 21.2 percent  year-on-year year in Q2 21 (April-June, or Q1 of fiscal year 2021-22), as a low base and a much smaller loss of activity due to the second COVID wave pushed growth to an all-time high for a single quarter.

"Looking at the details, we believe year-on-year growth in the rural sector is likely to slow modestly in Q2, as the second wave spread deep into the rural countryside. As such, rural consumption showed clear signs of slowing during the quarter, with weaker sales of fertilizer and two wheelers, and an increase in the rural unemployment rate during the quarter. On the other hand, we expect output in the mining sector to improve modestly," the report said.

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