COVID19 Lockdowns Crush Indian Economy in April-June Quarter of 2020

Time:Thu, 03 Sep 2020 09:30:26 +0800

keywords :

India’s National Statistical Office has released the estimates of Gross Domestic Product for April-June quarter of 2020-21 GDP at Constant 2011-12 Prices in Q1 of 2020-21 is estimated at INR 26.90 lakh crore, as against INR 35.35 lakl crore in Q1 of 2019-20 showing a contraction of 23.9 percent as compared to 5.2 percent growth in QI 2019-20. The April-June quarter GDP data is the worst contraction in the history of the Indian economy since Independence but isn’t a surprise.. Widespread and repeated lockdowns have resulted in this sharp fall. Construction contracting 50.3 per cent and Trade, hotel, transport, and communication contracting 47 per cent are the two negative surprises. Investments too contracted 47.1 per cent. While the rural economy has offset the slowdown in urban areas in Q1 to some extent, rural recovery is unlikely to support such pace in subsequent quarters. One reason for this is that Covid-19 has started to penetrate rural areas at a fast pace since July. Double digit contraction in GDP remains likely also during the current quarter with the headwinds of fresh lockdowns weighing on economic recovery.

GDP data shows that construction took the steepest hit along with manufacturing and the trade, hotels and transport segment.
Agriculture sector grew at 3.4%.
Mining sector contracted 23,8%,
Manufacturing contracted 39.3%.
Construction contracted 50,3%.
Trade, hotel, transport, communication contracted 47%.
Financial services sector contracted by 5.3%.
Public administration, defense and other services contracted by 10.3%.

Sector	Q1 FY20	Q2 FY20	Q3 FY20	Q4 FY20	Q1 FY21
Agriculture	3.0	3.5	3.6	5.9	3.4
Manufacturing	3.0	-0.6	-0.8	-1.4	-39.3
Construction	5.2	2.6	0.0	-2.2	-50.3
Trade, Hotels	3.5	4.1	4.3	2.6	-47.0
Finance, Real Estate	6.0	6.0	3.3	2.4	-5.3

Sl	Indicators	Q1 2019-20	Q1 2020-21
1	Production of Coal	2.6	-15.0
2	Production of Crude Oil	-6.8	-6.5
3	Production of Cement	1.0	-38.3
4	Consumption of Steel	5.0	-56.8
5	Total Telephone Subscribers	1.5	-2.0
6	Sales of Commercial Vehicles	-9.5	-84.8
7	Cargo Handled at Major Sea Polls	1.7	-19.8
8	Cargo Handled at Airports	-6.5	-57.2
9	Passengers Handled at Airports	-0.6	-94.1
10	Railways
10	(i) Net Tonne Kilomet el's	0.7	-26.7
10	(ii) Passenger Kilometers	-2.2	-99.5
11	Aggregate Bank Deposits	10.4	9.6
12	Aggiegate Bank Credits	11.9	5.6
13	LIC Premium - N on-L inked	35.6	-14.7
14	LIC Premium - Linked	-3.7	20.9
15	CPI General Index	3.1	6.6
16	IIP
16	(i) Mining	3.0	-22.4
16	(ii) Manufacturing	2.4	-40.7
16	(iii) Electricity	7.3	-15.8
16	(iv) Metallic Minerals	17.9	-43.3
17	WPI
17	(i) Food Articles	7.0	2.5
17	(ii) Minerals	18.3	-1.2
17	(iii) Manufactured Products	1.5	-0.03
17	(iv) All Commodities	2.7	-2.3

GDP Trend

Year	GDP growth rate in %
2012-13	5.5
2013-14	6.4
2014-15	7.4
2015-16	8.0
2016-17	8.3
2017-18	7.0
2018-19	6.1
2019-20	4.2
Q4'19-20	3.1
Q1'20-21	-23.9
QoQ Swing	-27.0