India GDP Data Today
During the first quarter of 2020-21, India’s GDP had shrunk by 24.38 per cent, hit mainly by the Covid-19 pandemic.
Recording its worst ever performance in over four decades, India clocked a negative growth of 7.3 per cent for 2020-21 while the fourth quarter of the fiscal showed a meagre rise of 1.6 per cent.
For the full year of 2020-21, growth in GDP is estimated at -7.3 per cent as compared to 4 per cent in 2019-20. This is the first yearly economic contraction in 40 years. In 1979-80, GDP had shrunk by 5.2 per cent.
The strict nationwide lockdown imposed to curb the spread of Covid-19 last year led India to experience its first technical recession with two consecutive quarters of contraction.
In the first quarter of this fiscal, the economy had shrunk by an unprecedented 24.4 per cent. However, due to spurt in economic activities in the second quarter, GDP decline had narrowed to 7.3 per cent.
India Q4 GDP Today
The fourth quarter numbers are all the more poor as during the January-March period, all sectors had been completely opened and the situation was near normal, yet a 1.6 per cent growth during the fourth quarter of FY21 shows all is not well with the fiscal health of the nation.
Addressing the media after release of GDP numbers, chief economic advisor (CEA) Krishnamurthy Subramanian said that the contraction in annual GDP is mainly due to the effect of the pandemic. Overall economic impact of second COVID-19 wave not likely to be very large, he added.
“Agriculture sector has been the silver lining, see steady demand in second half of the year,” he said.
The CSO had projected 8 per cent GDP contraction in FY21, implying a contraction of 1.1 per cent in March quarter. Meanwhile, the Reserve Bank of India had projected a 7.5 per cent contraction for FY21. However, most of the analysts had expected the economy to bounce back at a better-than-expected pace in March quarter, and predicted that the FY21 contraction would be less than CSO’s projection of 8 per cent.
According to a SBI research report, India’s GDP was likely to expand by 1.3 per cent in January-March quarter, thus leading to a less-than-expected 7.3 per cent contraction during FY21.
The economy, which was facing a slowdown even before the pandemic, now confronts a crash of consumer demand – constituting over 55 per cent of the economy – as household incomes and jobs have declined.
Meanwhile, unemployment soared to a near one-year high of 14.73 per cent in the week ending May 23, according to the Centre for Monitoring Indian Economy.