GDP Contracts 7.5 % in Q2, India Enters ‘Technical Recession’
New Delhi: India’s Gross Domestic Product (GDP) contracted 7.5% in second quarter (Q2) of 2020-21 compared to the same period (July-September) last year.
The Reserve Bank of India had anticipated a GDP contraction of 8.6 per cent.
It’s a much better figure than the steep and alarming 23.9% reduction in GDP during Q1 (April-June 2020), according to National Statistical Office data. But the fact is, India’s performance is among the worst when major advanced and emerging economies are considered.
Following contractions in two successive quarters, India has entered into a ‘technical recession’ for the first time since Independence.
As per RBI’s estimation, the economy will contract by 9.5% for the full fiscal year.
An Oxford Economics report earlier this month stated that India will be the worst-affected economy after the COVID-19 pandemic eases, predicting annual output to be 12% below pre-coronavirus levels through 2025.
To get a perspective, China’s economy grew by 4.9% in Q2, faster than the 3.2% growth in April-June 2020.