India GDP shrinks by 23.9%, economy crisis in spotlight


India’s GDP shrank by 23.9 percent in the first quarter of 2020, official data showed Monday, throwing into spotlight the crisis of an economy that not too long ago was one of the world’s fastest growing.

This is the steepest-ever decline of the Indian economy.

The country had seen GDP growth of 5.2 per cent in the corresponding quarter of financial year 2019-20, which was also a slowing down for an economy that had been growing at around 8 percent for a decade.

In the quarter just before April-June 2020, India’s economic growth was at 3.1 percent.

That means India’s economy was already ailing and the Covid-19 pandemic has badly battered it.

Earlier this month, a survey said 18.9 million Indians lost their salaried jobs since April 2020.

The country had observed mobility restrictions as mandated under the lockdown measures for the better part of April to June.

Krishnamurthy Subramanian, chief economic adviser to the Indian government, more or less echoed what the country’s finance minister had said — that the pandemic was an act of god.

“As the world economic outlook has highlighted, the fraction of countries where GDP per capita would decrease is the highest since 1870, so once in a one-and-a-half century event, which is what we are going through,” Subramanian said Monday.

India was also in a lockdown all through the April-June quarter with the majority of economic activities being restricted, so this trend is along the expected lines,” he added.