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India's economy is expected to grow at 6.5-7% during the next financial year (FY23) and over 7% thereafter, chief economic advisor Krishnamurthy Subramanian said on Tuesday.

Subramanian, who would be demitting office after completing his three-year stint next month, said, "We are projecting 6.5-7% (growth) next year and thereafter 7% plus over different scenarios. I think the impact impact of seminal second generation reforms will unfold in terms of both investment and in productivity going forward."

Earlier, during the day, government data showed that India's gross domestic product (GDP) expanded by 8.4% from a year ago period as economic activity picked up after the second wave of coronavirus.

The growth during the quarter was mainly led by private consumption even as vaccinations accelerated during the period and daily case count dropped sharply from record highs.

The GDP is expected to grow in the double-digits in the current financial year, Subramanian said.

The chief economic advisor has further expressed confidence that the government will meet the fiscal deficit target of 6.8% of GDP for current financial year.

Fiscal deficit during the April-October period has touched 5.47 lakh crore and is at 36.3% of the budgeted target.

Earlier, during the day, Bloomberg reported that the government is unlikely to meet the fiscal goals as it boosts spending and struggles to complete planned asset sales.

The gap may widen to more than 7% of gross domestic product in the year through March 31 versus the 6.8% goal, sources told Bloomberg. Lower divestment collections is also seen offsetting gains from higher tax collections.

The Economic Survey 2020-21, released in January this year, had projected GDP growth of 11 per cent during the current financial year ending March 2022.

With regard to the impact of the new coronavirus variant Omicron, he said it is too early to comment.

He, however, said the impact would be less than the first wave as the government already has experience of handling two waves of the pandemic.

"Given that we are still amidst pandemic and the Omicron variant seems to have actually created some concern, we are all waiting for evidence to come on how infectious would it be, and how debilitating would it be as well compared to the Delta variant," he said.

Asked about the impact of repeal of three farm laws on the reforms process, the CEA said it should not affect reforms in other sectors.

"In a democracy like ours, political economy matters a lot and I think it is a fact that the way agriculture generates emotion other sectors do not.

"Therefore, extrapolating anything that you are seeing in agriculture, be it reforms or otherwise, on to other sectors...I would not recommend, because the dynamics are quite different," he said.

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