India GDP Contracts A Record 23.9% In April-June Quarter 

The Indian economy contracted by a record 23.9% in the April-June 2021 quarter, as the country went into the lockdown to curb the spread of the Covid-19 virus.

India’s real GDP fell to 26.9 lakh crore in constant terms, 23.9% lower than a year ago, showed data released by the Ministry of Statistics and Programme Implementation on Monday. Nominal GDP fell to Rs 38.08 lakh crore, 22.6% lower than the same period last year.

In gross value added terms, the economy contracted 22.8%.

A Bloomberg poll of 31 economists had forecast GDP to contract 18% in the April-June quarter.

The Covid crisis has brought on India’s fourth recession since independence and the first since liberalisation. The economy last contracted in FY80. This is the first contraction since India began releasing GDP growth data on a quarterly basis in 1997-98.

Sectoral Break-Up

A deeper dive into the 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%.

Expenditure Trends

• Private consumption, reflected in private final consumption expenditure, fell 26.7%.
• Investments, as reflected by gross fixed capital formation, contracted 47.1%.
• Government final consumption expenditure grew 16.4%.
• Net exports of goods and services contracted 19.8%.