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He said that indicators like rail freight traffic and electricity consumption are pointing towards improvement in economic activity.
“Looking at the intensity of the lockdown … high intensity, this (growth number) is actually along the expected lines. What is important is that India is a veteran V shape recovery After the announcement of the unlock, “he told PTI.
Citing some examples, he said that railway freight, often a good indicator of economic activity, reached 95 percent of the level seen in July last year and was 6 percent higher in the first 26 days of August. The same thing happened last year.
Power consumption is down by just 1.9 percent compared to last year.
“E-way bills occupy interstate trade, which are affected by local lockdown and yet the e-way bill is 99.8 percent so far in August.”
Talking about eight infrastructure sectors, he said that the production of core sector declined by 38 percent in April, but since then the rate of contraction has come down to 22 percent in May, 13 percent in June and 9.6 percent in July. has gone.
Update: Government released Q1 GDP data
“Overall, there is clearly a V-shaped recovery. One notable thing is that the agricultural sector is an area that has grown at a rate of 3.4 percent despite the lockdown in Q1 … (it) has a number of reform measures. The government has made announcements, such as the APMC Reforms and Essential Commodities Act, etc., he said.
This is also reflected in rural inflation, which is now higher than urban inflation, he said.
COVID-19 Crisis hit, India’s GDP fell 23.9 percent in April-June, as against 5.2 percent growth in the same quarter last fiscal, according to data released by the National Statistics Office (NSO ).
Subramanian stressed, “This fall is expected to result in a lockdown globally and India is certainly experiencing a V-shaped recovery. Therefore, we should expect a better performance in later quarters.”
Comparing the contraction with the UK economy, the CEA said India’s lockdown was more acute than that of the UK, which saw a 22 percent drop in the April-June quarter.
Citing the World Economic Outlook by the International Monetary Fund, he said that it underlined that GDP per capita would decline the most after 1870.
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He said that this is a one-and-a-half century event in which India is also going.
According to data from the NSO, the construction sector GVA was contracted by an increase of 50.3 percent from the earlier 5.2 percent expansion. Mining sector production declined by 23.3 percent, compared to 4.7 percent a year earlier.
The electricity, gas, water supply and other utility services sector also declined by 7 percent in the first quarter of 2020-21 as compared to 8.8 percent a year ago.
Similarly, broadcast-related trade, hotels, transportation, communications and services declined by 47 percent in the first quarter, up from 3.5 percent earlier.
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