The Indian economy saw its worst contraction in decades, with Gross Domestic Product (GDP) shrinking by a record 23.9% in the April to June quarter of 2020 in comparison to the same period last year.
- The data was released by the National Statistical Office under the Ministry of Statistics and Programme Implementation (MoSPI) on August 31, 2020.
- The contraction means that the total value of goods and services produced in India in April, May and June 2020 is 24% less than the total value of goods and services produced in India in the same three months last year (April-June 2019).
- Agriculture and allied activities, meanwhile, were a bright spot, growing 3.4 per cent during the quarter.
- This is the first instance of an economic contraction for the country in at least four decades, and also the first GDP decline since India began publishing quarterly numbers in 1996.
- Experts expect annual GDP to contract 5%-7% in 2020-21, noting that the last contraction of the economy occurred in 1979-80, when GDP shrank 5.2%. There have been four other instances of minor contraction between 1965-68, and 1972-73.
- India is not alone in reporting dismal GDP numbers. Even as China managed to buck the trend and, in fact, see an expansion of 3.20 per cent during the April-June quarter, the UK’s economy shrank 21.7 per cent, Germany’s by 10.10 per cent, and the US’ by 9.10 per cent.
(Source: The Hindu, Business Standard, Indian Express)
