Capex set to cross pre-Covid levels; household expenditure, consumption lag

This indicates that in spite of strong recovery in 2021-22 from the contraction last fiscal year, consumption recovery among the populace is still not broad-based

According to the first advance estimates of national income released by the National Statistical Office (NSO) on Friday, government consumption expenditure and overall investment for financial year 2021-22 (FY22) are projected to cross the pre-pandemic level of FY20. However, household expenditure and consumption still haven’t recovered to that level.

In absolute inflation-adjusted terms, real gross fixed capital formation (GFCF) is projected at Rs 48.5 trillion for FY22, compared with provisional estimates (PE) of Rs 42.2 trillion in FY21 and Rs 47.3 trillion in FY20. Government final consumption expenditure (GFCE) is expected to come in at Rs 17.1 trillion for FY22,