Corona crisis deeply affected Indian GDP 23.9% decline. 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. The Ministry of Statistics and Program Implementation has released GDP figures for the April-June quarter of the financial year 2020-21. The data for the core sector, which came a while ago, has also disappointed. Production of eight industries declined by 9.6 percent in July.
Corona crisis deeply affected Indian GDP 23.9% decline
Cause of decline
Significantly, due to the lockdown of two months in April and May in this quarter, the economy is stagnating and in June it also got a slight momentum. For this reason, rating agencies and economists have expressed the possibility that the GDP for the June quarter may fall by 16 to 25 percent. If this happens, it will be a historic decline.
This apprehension is being expressed in view of the figures of industrial production, expenditure figures of the Central and State Governments, agricultural production and performance of business of transport, banking, insurance etc.
Rating agencies estimate
Experts say that manufacturing, construction, trade, hotels, transport, communication etc. sectors contribute about 45 per cent of the country’s GDP and in the first quarter the business of all these sectors has been badly affected.
Rating agency ICRA had forecast a 25 per cent decline in GDP. Similarly, India Ratings had forecast a fall of around 17 per cent in GDP. Saumya Kanti Ghosh, Group Economic Advisor of State Bank of India had projected a 16.5 per cent decline in GDP.
What happens to the common man
The GDP figures also affect the common people. If the GDP figures are constantly slow, then it is considered a danger bell for the country. Due to lower GDP, the average income of the people decreases and people go below the poverty line. Apart from this, the pace of creation of new jobs is also reduced. The possibility of retrenchment increases due to economic slowdown.