FY20 growth stands at 11-yr low of 4.2%

nNEW DELHI: The Indian economy grew by 3.1% in the three months ended March and 4.2% in 2019-20 on the back of falling investment and consumption, with the lockdown imposed to slow the spread of the coronavirus disease (Covid-19) having only a marginal impact because it affected only the last week of March.

The lockdown, however, is expected to sharply affect growth in 2020-21, with many analysts estimating that the economy will actually shrink, perhaps by as much as 5% this financial year.

The quarterly and annual numbers are against projections of 4.7% and 5% respectively, although it has been clear for some time that these will not materialise. Provisional accounts for 2019-20 released Friday showed that the fiscal deficit for the year was 4.59%.

To be sure, the March quarter performance is better than expected. A Reuters poll of economists forecast a growth rate of 2.1% for the March quarter.

GDP growth in FY2019-20, lowest in 11 years

GDP growth in Q4 of FY2019-20, slowest for the same period in 8 years

Decline in output of India’s eight core industries in April 2020

Fiscal deficit as of March 31, 2020, higher than the govt’s estimate of ~7.66 lakh crore

CHANGE IN GVA GROWTH BETWEEN Q3 AND Q4 Sectors Change in Employment

GVA growth share (in %)

Agriculture, forestry and fishing Trade, hotels, transport, storage and communication Manufacturing

Construction

Public administration, defence and other services Financial services, real estate and professional services Electricity, gas, water supply and other utility services Mining and quarrying

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