Covid Casualty: India’s YoY FY21 GDP plunges to 7.3%

Covid-19-induced volatility heavily dented India’s economy last fiscal as its growth rate plunged (-) 7.3 per cent in 2020-21.

Though not comparable, the GDP had grown by 4 per cent in 2019-20.

The pandemic-triggered national lockdown (from late March 2020) during Q1FY21 had a massive impact on the economy, which suffered a GDP contraction of 24.4 per cent. It was only on June 1, 2020, that the partial unlock measures were implemented.

However, pent-up demand and gradual opening up of economic activities arrested any other economic pitfall.

Nonetheless, the devastating impact on consumer services, urban demand and rising commodity prices had more or less painted a grim economic picture for FY21.

The data furnished by the National Statistical Office (NSO) showed real GDP or Gross Domestic Product (GDP) at constant (2011-12) prices in year 2020-21 attained a level of Rs 135.13 lakh crore, as against the ‘First Revised Estimate’ of GDP for the year 2019-20 of Rs 145.69 lakh crore.

On the other hand, in terms of sequential basis, India’s economy grew during the fourth quarter, which ended on March 31, 2021, by 1.6 per cent.

“‘GDP at Constant (2011-12) Prices in Q4’ of 2020-21 is estimated at Rs 38.96 lakh crore, as against Rs 38.33 lakh crore in Q4 of 2019-20, showing a growth of 1.6 per cent,” according to the GDP estimates released by the Central Statistics Office (CSO).

In terms of quarterly Gross Value Added (GVA), the NSO data showed a year-on-year rise of 3.7 per cent from 1 per cent in Q3FY21.

The GVA includes taxes, but excludes subsidies.

On a sequential basis, Q4 GVA for 2020-21 from the agriculture, forestry and fishing sector rose to 3.1 per cent growth, against 4.5 per cent in the preceding quarter of 2020-21.

The GVA from the manufacturing sector grew 6.9 per cent, as compared to a growth of 1.7 per cent in Q3FY21.