India’s gross domestic product (GDP) grew 3.1 percent during January-March this year. It could get worse as restrictions and lockdowns continue to constrain people’s movement, severely hurting economic activity. The nation-wide lockdown kicked-in from March 24, and its actual impact on the economy will show up in the subsequent months when businesses screeched to a standstill. COVID-19 induced disruptions appeared to have devastated the broader economy, pummeled by collapsing household spending and shuttered businesses that are battling to stay afloat.
An economy is often described to be in a recession when real GDP contracts in two successive quarters. India’s GDP grew 4.1 percent in October-December 2019 and 5.7 percent in 2018-19. Gross value added (GVA) grew 3 percent in January-March 2020, compared to 3.5 percent in the previous quarter and 5.6 percent in the same quarter of FY 20.In this edition of Business Insight, Gaurav Choudhury decodes the Q4FY20 GDP data.