Covid-19 Update: India reported 3.1% GDP growth in FY 2020

India reported a GDP growth rate of 4.1% for the FY20 whereas the Q4FY20 GDP growth rate was at 3.1% as reported by National Statistical Office (NSO).

GDP

NSO stated that due to the pandemic followed by nationwide lockdown the data stream from economic activities was impacted. The estimates are analysed as per data available as many industries are yet to begin their operations and regulatory extension was also okayed in reporting their financial returns.

As per the estimates, the GDP has dropped to 4.1% for 2019-20 as compared to 6.1% in 2018-19. Besides for the Q4 FY20, the GDP growth rates were reported at 3.1%.

As per the second advance estimates issued by the NSO released in February 2020, NSO implied real GDP growth of 4.7 percent for Q4 FY20 within the annual estimate of 5 percent for the year as a whole.

RBI Governor, Shaktikanta Das in his last policy announcement said, “This is now at risk from the pandemic’s impact on the economy,”

According to RBI Governor Das, growth was projected to be around 3.5% instead of 4.7% and hence the GDP growth for the year 2019-20 is expected to be around 4.7% instead of 5% as predicted by the NSO.

He also warned that the “estimated to remain in negative territory”, with some pick-up in growth impulses from H2: 2020-21 onwards.

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