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BIG STORY                                                             NOVEMBER 27, 2020  |        The Indian Eye                          4





           indian ecOnOmy









              How Bad is it?










          with the contraction of 7.5 per cent in the second quarter, the indian economy

                      has hit recession. But the government claims a V-shaped recovery.

                           what is the actual scenario of asia’s third biggest economy?





        Our Bureau

        New Delhi

               he Indian economy con-
               tracted by 7.5 per cent
        Tin the July to September
        quarter (Q2 FY21), govern-
        ment data showed here on Fri-
        day. Though this is a rebound
        from the earlier quarter but
        with this contraction Indian
        economy  has  hit  technical  re-
        cession for the first time.
            According to the Ministry
        of Statistics and Programme
        Implementation, gross value
        added (GVA) came in at minus
        7 per cent. The economy had
        contracted by 23.9 per cent in
        the April to June quarter (Q1
        FY21),  marking  the  first  con-
        traction in more than 40 years
        as COVID-19 pandemic com-
        pressed consumer demand and
        private investments.                               shopping during the festival season has given a little boost to indian economy (ANi)
            “GDP at Constant (2011-
        12) Prices in Q2 of 2020-21  contraction of 7 per cent,” it  utility services have shown a                    -10.7 per cent from -12.5 per
        is estimated at Rs 33.14 lakh  added.                                    growth of 4.4 per cent; agricul-     cent with a positive bias, in a re-
        crore, as against Rs 35.84 lakh         The statement said during  ture, forestry and fishing sector          search report from SBI Ecow-
        crore in Q2 of 2019-20, show- the quarter trade, hotels, trans- at 3.4 per cent and manufactur-               rap on Friday.
        ing a contraction of 7.5 per cent  port and communication saw  ing  sector  showed a  marginal                    The report titled, “Posi-
        as compared to 4.4 per cent  a dip of -15.6 per cent while  growth of 0.6 per cent.                           tive events improve India’s Q2
        growth in Q2 2019-20,” said  public administration, defense                  The  economy  was  already       GDP projections: Losses re-
        the Ministry of Statistics and  and other services by -12.2 per  slowing before the pandem-                   duced but reasons to remain
        Programme Implementation in  cent. The financial, real estate  ic struck, growing only 4.2 per                cautious remain,” was authored
        a statement.                         and professional services sector  cent  in  the  last  fiscal  year,  its   by Dr Soumya Kanti Ghosh,
            “Quarterly  GVA  at Basic  contracted by 8.1 per cent and  slowest pace in 11 years.                      SBI’s Chief Economic Adviser.
        Prices at Constant (2011-12)  construction by 8.6 per cent.                  Now, citing continuous revi-     According to it, the upward re-
        Prices for Q2 of 2020-21 is es-         Some sectors have bounced  sions in India’s GDP estimates             visions reflected faster recovery
        timated at Rs 30.49 lakh crore,  back with resumption of eco- as the current norm, State Bank                 and the estimates could be bet-
        as against Rs 32.78 lakh crore  nomic activities. The electrici- of India (SBI) revised their
        in Q2 of 2019-20, showing a  ty, gas, water supply and other  second-quarter (Q2) GDP to                          Continued at next page... >>


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