The Indian economy witnessed a whopping 23.9 percent contraction, the gross domestic product (GDP) numbers for the April-June quarter of fiscal year 2020-21 released on August 31 showed.
The real GDP shrank 22.6 percent in the said quarter, marking the sharpest drop in the country's growth numbers in more than 40 years.
The July-September quarter numbers become extremely important as another contraction would technically mean India has entered recession. The country's economy had last entered a recession in 1979.
Also Read | India's GDP contracts 23.9% in Q1FY21 as lockdowns, restrictions bludgeon economy
In the Budget for 2020-21, Finance Minister Nirmala Sitharaman had assumed nominal GDP growth of 10 percent in 2020-21, and fiscal deficit of 3.5 percent of GDP, a goal that looks almost unthinkable to achieve given the rapid turn of events.
Frequently Asked Questions
A vaccine works by mimicking a natural infection. A vaccine not only induces immune response to protect people from any future COVID-19 infection, but also helps quickly build herd immunity to put an end to the pandemic. Herd immunity occurs when a sufficient percentage of a population becomes immune to a disease, making the spread of disease from person to person unlikely. The good news is that SARS-CoV-2 virus has been fairly stable, which increases the viability of a vaccine.
There are broadly four types of vaccine — one, a vaccine based on the whole virus (this could be either inactivated, or an attenuated [weakened] virus vaccine); two, a non-replicating viral vector vaccine that uses a benign virus as vector that carries the antigen of SARS-CoV; three, nucleic-acid vaccines that have genetic material like DNA and RNA of antigens like spike protein given to a person, helping human cells decode genetic material and produce the vaccine; and four, protein subunit vaccine wherein the recombinant proteins of SARS-COV-2 along with an adjuvant (booster) is given as a vaccine.
Vaccine development is a long, complex process. Unlike drugs that are given to people with a diseased, vaccines are given to healthy people and also vulnerable sections such as children, pregnant women and the elderly. So rigorous tests are compulsory. History says that the fastest time it took to develop a vaccine is five years, but it usually takes double or sometimes triple that time.
Here are the key highlights from the Q1FY21 GDP numbers:
> The 'real' or inflation-adjusted gross domestic product (GDP) contracted 22.6 percent in the April-June quarter this fiscal.
> Barring the agriculture sector that grew 3.4 percent, all others were in the red.
> Manufacturing, mining and construction contracted 39.3 percent, 23.3 percent and 50.3 percent respectively.
> Gross Value Added (GVA), which is GDP minus taxes, contracted 22.8 percent in April-June 2020 compared to 4.8 percent growth last year.
> Trade, hotels, transport, communication and services related to broadcasting contracted 47 percent in the first quarter of 2020-21.
> The real estate sector, along with financial and professional services, shrank 5.3 percent in April-June 2020.
Follow our coverage of the coronavirus crisis here