NEW DELHI: The industry on Monday said the steep 23.9 per cent contraction in the GDP in April-June was on expected lines reflecting the "stalling of
economic activities
" due to the lockdown imposed in response to
coronavirus pandemic
.
The industry, however, said it anticipates the economy to stage a gradual recovery in the coming quarters on account of reforms, the Rs 20 lakh crore stimulus package and measures taken by the Reserve Bank.
India's GDP shrank steeply by 23.9 per cent in the April-June period as the coronavirus lockdowns battered an already slowing economy.
Agriculture was the only outlier as all other sectors, including manufacturing, construction and services, suffered steep declines.
CII Director General Chandrajit Banerjee said the large contraction in the first quarter GDP print at 23.9 per cent was widely expected, and it reflects the wide-spread stalling of economic activities due to the stringent lockdown in response to the pandemic.
"Even as the first half of the current fiscal is expected to remain weak, we can expect a recovery in the second half led by supportive fiscal and monetary policies," Banerjee said.
In this context, he said, the localised lockdowns being imposed by state and district administrations may be avoided so that the economic recovery can be kept on track.
"Going forward, we are anticipating contractions -though a bit better in numbers- in the July- September quarter and the October- December quarter as well. However, in the quarters post that, we anticipate some amount of recovery to take place," Assocham president Niranjan Hiranandani said.
The country would witness even a recovered growth curve in the quarters after that due to a series of measures, he stated.
“The Rs 20 lakh crore stimulus package, the measures taken by the Reserve Bank of India and the administrative reforms would show a positive outcome in the economy,” he said.
PHDCCI President D K Aggarwal said the reforms undertaken by the government will bring the economy back on its growth path sooner than later.
India's economy had grown by 5.2 per cent in the same quarter of last fiscal, as per the data released by the National Statistical Office.
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