Volume-wise, GDP falls to Rs33.14 trn as against Rs35.84 trn a year ago
NEW DELHI/November 27-2020: The Indian economy has officially entered a technical recession, with the GDP at constant price for the June-September quarter having contracted 7.5 per cent year-on-year and thus rendering this the second consecutive quarter of GDP contraction.
Technically, an economy is said to be in recession after it contracts for two quarters in a row. India’s economy had contracted 23.9 per cent in the first quarter ending June 30, 2020.
The National Statistical Office (NSO), Ministry of Statistics and Programme Implementation released the estimates of Gross Domestic Product (GDP) for the second quarter (July-September) Q2 of 2020-21, both at Constant (2011-12) and Current Prices.
Volume-wise, GDP at Constant (2011-12) Prices in Q2 of 2020-21 is estimated at Rs33.14 lakh crore, as against Rs35.84 lakh crore in Q2 of 2019-20, showing a contraction of 7.5 per cent as compared with 4.4 per cent growth in Q2 2019-20.
GDP at current prices
GDP at Current Prices for Q2, 2020-21 is estimated at Rs47.22 lakh crore, as against Rs49.21 lakh crore in Q2, 2019-20, showing a contraction of 4.per cent as compared with 5.9 per cent growth in Q2, 2019-20.
The 7.5 per cent contraction of GDP in Q2, was on the back of the steep contraction in manufacturing, construction, and services, data released by the National Statistical Office showed.
Fall slower than projected
However, the pace of contraction was slower than analyst estimates. Analysts polled by news agencies Reuters and Bloomberg had expected a contraction of 8.8 per cent and 8.2 per cent, respectively, for the second quarter.
Gradual recovery on?
However, the data also showed that the country has begun its gradual recovery following the nationwide lockdown in April, May, and June which had flat-lined the economy.
The contraction by 23.9 per cent of GDP in the first quarter ending June 30 was the steepest fall ever (and the first contraction in 40 years).