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GDP shrinks by 7.3%; Q4 uptick moderates 2020-21 carnage -Vikas Dhoot

-The Hindu

On inflation, the Chief Economic Adviser said it is expected to be range-bound and should not exceed the prescribed level.

India's Gross Domestic Product (GDP) contracted by 7.3% in 2020-21, as per provisional National Income estimates released by the National Statistical Office on Monday, marginally better than the 8% contraction in the economy projected earlier. GDP growth in 2019-20, prior to the COVID-19 pandemic, was 4%.

The Gross Value Added (GVA) in the economy shrank 6.2% in 2020-21, compared to a 4.1% rise in the previous year. Only two sectors bucked the trend of negative GVA growth — agriculture, forestry and fishing, which rose 3.6%, and electricity, gas, water supply and other utility services (up 1.9%).

Though this is the bleakest performance on record for the economy, the fourth quarter (Q4) of 2020-21 helped moderate the damage, with a higher-than-expected growth of 1.6% in GDP. This marked the second quarter of positive growth after the country entered a technical recession in the first half of the year.

GDP had contracted 24.4% in the April to June 2020 quarter, followed by a 7.4% shrinkage in the second quarter. It had returned to positive territory in the September to December quarter with a marginal 0.5% growth.

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