The government informed Parliament that overall gross domestic product (GDP) at constant prices did not decline during any of the four quarters of 2019-20. Decline in the first quarter of 2020-21 was owing to fall in the growth rates in almost all the broad sectors, except Agriculture, forestry and fishing sector.
India’s coal-fired electricity generation rose 9.4% in the first half of September, provisional government data showed, as demand from industrial western states rose for the first time since coronavirus lockdowns were enforced.
Asian Development Bank, Nomura, as well as S&P have revised India’s GDP forecasts for FY2020-21 to minus nine per cent. Earlier ADB had expected a 4% contraction for the same period. Last week, two other global rating agencies Moody’s and Fitch projected Indian economy to contract 11.5% and 10.5% respectively in the current fiscal. However, Goldman Sachs has estimated the contraction at 14.8%. Domestic agencies – India Ratings and Research projected contraction at 11.8%, while Crisil estimated contraction at 9%. The latest forecasts have come amid massive 23.9% contraction in the June quarter.
India’s exports fell for the sixth straight month owing to subdued economic activity resulting from lockdowns imposed to curb the rising Covid-19 cases. For the month of August, the exports fell 12.7% compared to the same period last year while imports were down 26% resulting in narrowing of trade deficit to $6.77 billion compared to $13.86 billion a year ago.
Chief Economic Advisor Krishnamurthy Subramanian exuded confidence that the country would be back to a high growth path through reforms announced by the government, after overcoming the COVID-19 pandemic.
Finance minister Nirmala Sitharaman sought Parliament’s approval for extra spending of Rs 2.4 lakh crore, out of which the cash outgo totalled Rs 1.7 lakh crore, largely for meeting expenditure linked to the Covid-19 pandemic.