Veteran banker Deepak Parekh is sanguine over GDP growth turning positive in fourth quarter
Bengaluru: In a development that comes as heartening, veteran banker Deepak Parekh has expressed confidence over GDP growth in the fourth quarter.
He is also sanguine about the improvement on the demand side. "Based on a series of high frequency data, there is a distinct trend of sequential month-on-month improvement. There is a lot of catch up required but suffice to say that worst is behind us," he said at a virtual conference organised by the Canada-India Business Council.
To corroborate his claims, he cited an example. He said toll collections are back to 88 per cent of pre-COVID-19 levels, e-way bills are increasing and electricity consumption has stabilised.
Parekh, the non-executive chairman of mortgage lender HDFC, said residential housing sales for this quarter have gone up by 34 per cent as people are buying ready-to-move-in apartments.
On the agricultural front, he said it too has been a very promising story and the country is expected to have record foodgrain production of 300 million tonnes this year.
On the growth outlook, Parekh said "for the first quarter we had contraction of 24 per cent but I am not too worried about that because India was in complete lockdown for most part of the quarter."
"For this (second) quarter which ended in September, we are expecting minus 5 per cent and last quarter we will be in positive territory. So I remain reasonably optimistic about India's potential," he added.
He said India is a domestic consumption-based economy and demand is set to rise in the coming months.
"We are consuming what we are producing, so demand has to increase...I am very optimistic about India story in short to medium term," he added.
Despite the shrinking economy, he said, Indian companies have raised USD 31 billion in the last couple of months, indicating there is enough liquidity in the market.
Read Exclusive COVID-19 Coronavirus News updates, at MyNation.