Goldman Sachs Positive On GDP On Tax Collection

On Indian GDP Goldman Sachs says: "We expect real GVA growth to have improved to 20.8% yoy (Bloomberg consensus 19.3% yoy) in 2021 Q2 from 3.7% yoy in 2021 Q1, driven by a low base in 2020 Q2, and a rapid rebound in economic activity in June, after the second wave of Covid-19 in India in April and May. We expect real GDP growth at 23.5% yoy (Bloomberg consensus: 21% yoy, 2021 Q1: 1.6% yoy) higher than real GVA growth on account of better net indirect tax collection in 2021 Q2 vs. 2020 Q2. The rebound in high frequency activity indicators has continued in July and August, and we expect growth in subsequent quarters to benefit from increased government spending (as spending in Q2 was muted due to Covid-19 induced restrictions), and as the pace of vaccination picks up. The key downside risk to growth going forward is from the looming threat of a third Covid wave after the Indian festive season in October and November."