Indian economy has made a sharp recovery despite the gross domestic product (GDP) contracting 7.5 per cent in the July-September period. Data released by the National Statistical Office indicated that the country had rebounded from the sharp contraction of 23.9% in the GDP for the April-June quarter
Indian economy has made a sharp recovery despite the gross domestic product (GDP) contracting 7.5 per cent in the July-September period.
Data released by the National Statistical Office indicated that the country had rebounded from the sharp contraction of 23.9% in the GDP for the April-June quarter
The two successive quarters of contraction though meant that the country had now entered "technical recession" for the first time since 1947.
The Finance Ministry, meanwhile, noted a V-shaped recovery in use-based Industries especially in consumer goods, especially consumer durables, and investment, especially capital and infrastructure goods suggest strong revival of both consumption and investment, which together account for about 90% of India's GDP.
Manufacturing clocked a 0.6% growth in July-September after it had shrunk by a massive 39% in the preceding quarter.
Continuing its good showing, the agriculture sector grew by 3.4% while the trade and services sector showed lower-than-expected contraction at 15.6%. Public spending was down 12%.
According to Chief Economic Advisor Krishnamurthy Subramanian, data suggests Indian economy had picked up momentum by February 2020 but was halted by the COVID-19 pandemic.
"We should be cautiously optimistic as the economic impact is primarily due to the pandemic and the sustainability of the recovery depends critically on the spread of the pandemic. Winter months warrant caution even though we have crossed the first wave's peak in September," Subramanian said.
According to CNBC-TV18, the GDP contraction of 7.5 percent in July-September compares with a growth of 4.4 percent in the same quarter last year. China's economy grew by 4.9 percent in July-September this year, faster than the 3.2 percent growth in April-June 2020.
According to reports, many economists expect the economy to return to expansion mode as early as in the December quarter, as the pickup sustains.
They predict a contraction of 3 per cent in the December quarter, followed by an expansion of 0.5 per cent in the final January-March period of financial year 2020-21 on hopes of better consumer demand fuelled by progress on coronavirus vaccines.
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Last Updated Nov 27, 2020, 9:34 PM IST