Why Indian GDP steep decline of 23.9 percent in GDP: Chief Economic Advisor. In the first quarter (April-June) of the financial year 2020-21, the government is once again on the target of the opposition with the figures of Gross Domestic Product (GDP). The June quarter saw a steep decline of 23.9 percent in GDP. Chief Economic Advisor (CEA) KV Subramanian, on behalf of the government, has responded to why this decline happened?
Why Indian GDP steep decline of 23.9 percent in GDP: Chief Economic Advisor
According to data released by the Ministry of Statistics and Program Implementation, the Corona crisis caused a historic 23.9 per cent decline in gross domestic product (GDP) for the first quarter of this fiscal year from April to June 2020-21.
What Subramanian said on
This steep decline, Chief Economic Advisor to the Central Government, KV Subramanian said that this is only according to the estimate, because the lockdown was imposed during April-June. He said that growth will accelerate in the second and third quarter and there will be a ‘V’ shape recovery in India’s economy.
This is the biggest drop in the time since India started releasing quarterly GDP figures. Before that, if we talk about GDP being negative, it was in 1979-80, when the annual GDP fell by 5.2 percent.
What is the reason
KV Subramanian said, ‘Stricter lockdown was implemented in the country for two months. Due to this, such a huge decline in GDP has been recorded. He further said that now the core sector has improved. Electricity consumption has increased, besides freight traffic has increased, e-way bill has increased. These are signs that clearly show that economic activities are improving.
He said, ‘This (corona) is an event happening in one and a half century, which we are facing. In April to June, most of the economic activity was banned due to lockdown in India. These figures are only according to estimates. He said that Britain’s GDP has also fallen by 22 per cent during this period.