India%20will%20lose%20nearly%20Rs%2012%20lakh%20crore%20in%20output%20in%202020-21%20and%20slide%20back%20by%20more%20than%20two%20years%20due%20to%20the%20pandemic%20and%20subsequent%20contraction%20in%20economic%20activity.%20The%20second%20advance%20estimates%20of%20national%20income%20released%20by%20the%20government%20show%20that%20on%20an%20average%2C%20the%20country%20will%20be%20losing%20nearly%20Rs%20one%20lakh%20crore%20a%20month%20in%20GDP%20or%20output%20this%20fiscal%2C%20the%20steepest%20contraction%20on%20record.%20The%20year%20will%20close%20with%20a%20GDP%20decline%20of%208%25%20versus%20a%204%25%20growth%20in%20the%20previous%20fiscal%202019-20.%20Why%20does%20GDP%20matter%3F%20Well%2C%20economic%20growth%20%28or%20GDP%20growth%29%20creates%20jobs%2C%20boosts%20consumption%20and%20leads%20to%20increased%20wages.%20An%20economic%20contraction%20hurts%20all%20sections%20of%20society.
%3Cstrong%3EAlso%20read%3A%20%3C/strong%3E%3Ca%20target%3D%22_blank%22%20rel%3D%22noopener%20noreferrer%22%20href%3D%22https%3A//opoyi.com/inflation-food-prices-down-but-cooking-gas-petrol-onions-on-fire%22%3E%3Cstrong%3EInflation%3A%20Food%20prices%20down%20but%20cooking%20gas%2C%20petrol%2C%20onions%20on%20fire%3C/strong%3E%3C/a%3E
The%20second%20advance%20estimates%20make%20two%20more%20things%20clear%3A%20one%2C%20the%20country%20has%20emerged%20from%20a%20recession%20in%20the%20third%20%28October-December%29%20quarter%20this%20year%20after%20logging%20two%20successive%20quarters%20of%20negative%20GDP%20growth.%20In%20Q3%2C%20GDP%20growth%20has%20been%20estimated%20at%200.4%25%2C%20leading%20to%20expectations%20of%20a%20sharp%2C%20%u2018V%u2019%20shaped%20recovery.%20Secondly%2C%20the%20estimate%20for%20the%20full%20year%20has%20been%20pulled%20down%2C%20from%20an%20earlier%20number%20of%20-7.7%25%20to%208%25%20for%202020-21.%20And%20even%20the%20sanctity%20of%20this%20revised%20estimate%20rests%20on%20robust%20economic%20recovery%20in%20the%20current%20quarter%2C%20which%20remains%20uncertain%20as%20cases%20of%20COVID-19%20spread%20have%20again%20begun%20rising%20and%20local%20lockdowns%20or%20increased%20restrictions%20could%20once%20again%20hamper%20economic%20activity.
So%20yes%2C%20the%20worst%20is%20over%20for%20now%20but%20the%20trajectory%20of%20COVID-19%20infections%20and%20the%20success%20of%20the%20government%u2019s%20mega%20vaccination%20drive%20will%20ensure%20that%20economic%20recovery%20does%20not%20flag%20going%20forward.
%3Cstrong%3ENumbers%3A%3C/strong%3E%20Real%20GDP%20at%20constant%20%282011-12%29%20prices%20in%202020-21%20is%20estimated%20to%20be%20Rs%20134.09%20lakh%20crore.%20This%20is%20lower%20than%20the%20Rs%20145.69%20lakh%20crore%20estimate%20for%202019-20%20and%20therefore%20the%20decline%20in%20this%20fiscal%20is%20expected%20to%20be%20-8%25.%20The%20per%20capita%20income%20in%20real%20terms%20%28at%202011-12%20prices%29%20during%202020-21%20is%20estimated%20to%20be%20Rs%2085%2C929%20against%20Rs%2094%2C566%20in%202019-20%2C%20a%20-9.1%25%20decline.%20Per%20capita%20income%20is%20the%20average%20income%20of%20all%20Indians%20and%20this%20has%20fallen%20by%20nearly%20Rs%209000%20this%20fiscal%20though%20it%20had%20risen%20by%202.5%25%20in%20FY20%20over%20the%20previous%20fiscal.
%3Cstrong%3EAlso%20read%3A%20%3C/strong%3E%3Ca%20target%3D%22_blank%22%20rel%3D%22noopener%20noreferrer%22%20href%3D%22https%3A//opoyi.com/new-tax-of-epf-interest-not-much-hike-in-health-defence-allocations-budget-fine-print%22%3E%3Cstrong%3ENew%20tax%20on%20EPF%20interest%2C%20not%20much%20hike%20in%20health%2C%20defence%20allocations%3A%20Budget%20fine%20print%3C/strong%3E%3C/a%3E
%3Cstrong%3ESegments%3A%3C/strong%3E%20The%20manufacturing%20sector%20posted%20a%20growth%20of%201.6%25%20in%20gross%20value%20added%20%28GVA%29%20in%20Q3%20%u2013%20it%20grew%20after%20three%20consecutive%20quarters%20of%20decline%20-%20as%20more%20factories%20opened%2C%20supply%20challenges%20lessened%20and%20more%20units%20making%20raw%20materials%20needed%20for%20larger%20factories%20to%20function%20became%20operational.
Agriculture%2C%20which%20did%20not%20contract%20throughout%20the%20pandemic%20even%20when%20most%20other%20segments%20of%20the%20economy%20were%20contracting%2C%20continued%20to%20grow%20by%203.9%25%20in%20Q3.%20Construction%2C%20a%20labour-intensive%20sector%2C%20finally%20also%20turned%20the%20corner%20to%20post%20a%20growth%20of%206.2%25.%20This%20segment%20had%20seen%20a%20nearly%2050%25%20degrowth%20in%20the%20April-June%20quarter%20due%20to%20lockdown%20and%20severe%20impact%20on%20overall%20economic%20activity.%20A%20revival%20in%20this%20sector%20means%20more%20jobs%20were%20created.%26nbsp%3BThe%20trade%2C%20hotels%20and%20transport%20sector%20also%20shrugged%20off%20the%20sloth%20to%20halve%20its%20degrowth%20at%20-7.7%25%20in%20Q3.%20Then%2C%20the%20sector%20%u2018Financial%2C%20real%20estate%20and%20professional%20services%u2019%20also%20rebounded%206.6%25%20from%20-9.5%25%20in%20Q2.
%3Cstrong%3ECorporates%20upbeat%3C/strong%3E%3A%20%3Ca%20target%3D%22_blank%22%20rel%3D%22noopener%20noreferrer%22%20href%3D%22https%3A//opoyi.com/never-before-budget-investors-india-inc-sigh-in-relief-at-absence-of-new-levies-growth-push%22%3E%3Cstrong%3EIndia%20Inc%3C/strong%3E%3C/a%3E%20has%20welcomed%20this%20recovery%20from%20a%20recession.%20The%20Federation%20of%20Indian%20Chambers%20of%20Commerce%20and%20Industry%20has%20said%20that%20the%20positive%2C%20albeit%20marginal%2C%20growth%20reported%20in%20the%20third%20quarter%20of%202020-21%20is%20encouraging.%20%u201CThe%20numbers%20are%20in%20line%20with%20the%20expectations%20and%20are%20reflective%20of%20the%20recovery%20being%20posted%20in%20most%20of%20the%20lead%20indicators.%20Going%20ahead%2C%20the%20roll-out%20of%20capital%20expenditure%20as%20announced%20in%20the%20Union%20Budget%20earlier%20this%20month%20should%20crowd%20in%20private%20investments%20and%20augurs%20well%20for%20overall%20economic%20revival%u201D.%20The%20Confederation%20of%20Indian%20Industries%20has%20also%20welcomed%20the%200.4%25%20growth%20projected%20by%20the%20government%20for%20Q3%2C%20calling%20it%20a%20promising%20sign%20%u201Cas%20it%20portends%20the%20end%20of%20the%20pandemic-induced%20recessionary%20phase%20seen%20in%20the%20first%20half%20of%20the%20year.%20One%20of%20the%20highlights%20of%20the%20data%20is%20the%20positive%20momentum%20seen%20in%20investment%20demand%20as%20it%20grew%20by%202.6%25%20in%20the%20third%20quarter%20after%20being%20in%20doldrums%20for%20several%20quarters%20now.%20This%20bears%20testimony%20to%20the%20unrelenting%20efforts%20of%20the%20government%20to%20go%20all-out%20to%20revive%20investments%20under%20the%20ambit%20of%20the%20various%20measures%20which%20formed%20a%20part%20of%20the%20Atmanirbhar%20Bharat%20package.
%3Cstrong%3EAlso%20read%3A%20%3C/strong%3E%3Ca%20target%3D%22_blank%22%20rel%3D%22noopener%20noreferrer%22%20href%3D%22https%3A//opoyi.com/economic-survey-reiterates-positives-skips-the-unpleasant%22%3E%3Cstrong%3EEconomic%20Survey%20reiterates%20positives%2C%20skips%20the%20unpleasant%3C/strong%3E%3C/a%3E
%3Cstrong%3ECaution%3C/strong%3E%3A%20The%20positive%200.4%25%20growth%20estimate%20for%20Q3%20may%20be%20revised%20down%20when%20the%20government%20released%20yet%20another%20set%20of%20estimates%20in%20May.%20This%20has%20been%20the%20norm%20in%20past%20years%20too.%20Estimates%20given%20out%20in%20February%20end%20are%20based%20on%20data%20collected%20for%20three%20quarters%20and%20additional%20data%20from%20the%20informal%20sector%20for%20the%20entire%20year%20comes%20in%20with%20a%20lag.%20So%20whether%20Q3%20actually%20saw%20growth%20or%20not%20will%20be%20certainly%20known%20for%20some%20months.%20Another%20thing%20to%20remember%20is%20that%20sustaining%20the%20current%20recovery%20rhythm%20depends%20upon%20several%20factors.%20First%2C%20the%20spread%20of%20COVID-19%20infections%20must%20subside%20and%20vaccinations%20must%20pick%20up%20for%20the%20economic%20recovery%20to%20remain%20robust.%20Second%2C%20the%20battered%20services%20industry%20%u2013%20airlines%2C%20hotels%2C%20tourism%20%u2013%20has%20improved%20but%20still%20needs%20handholding%20by%20the%20government.
%3Ca%20class%3D%22mention%22%20data-mention%3D%22%23GDP%22%20data-user-id%3D%22sdLvX0aD0qHh%22%20href%3D%22/topic/gdp%22%3E%23GDP%3C/a%3E%20%3Ca%20class%3D%22mention%22%20data-mention%3D%22%23Economy%22%20data-user-id%3D%225VhOB45vqxj9%22%20href%3D%22/topic/economy%22%3E%23Economy%3C/a%3E%20%3Ca%20class%3D%22mention%22%20data-mention%3D%22%23AtmanirbharBharat%22%20data-user-id%3D%225XWatzTBDb9h%22%20href%3D%22/topic/atmanirbhar-bharat%22%3E%23AtmanirbharBharat%3C/a%3E%20%3Ca%20class%3D%22mention%22%20data-mention%3D%22%23UnionBudget2021%22%20data-user-id%3D%22FIZlXh8mU3DG%22%20href%3D%22/topic/budget%22%3E%23UnionBudget2021%3C/a%3E%20%3Ca%20class%3D%22mention%22%20data-mention%3D%22%23IndianEconomy%22%20data-user-id%3D%22oibP8XaaqR0K%22%20href%3D%22/topic/indian-economy%22%3E%23IndianEconomy%3C/a%3E%20%3Ca%20class%3D%22mention%22%20data-mention%3D%22%23EconomicSurvey%22%20data-user-id%3D%22i0DtEq9N3ihZ%22%20href%3D%22/topic/economic-survey%22%3E%23EconomicSurvey%3C/a%3E%20%3Ca%20class%3D%22mention%22%20data-mention%3D%22%23India%22%20data-user-id%3D%22Bq4MmUPrXF8p%22%20href%3D%22/topic/india%22%3E%23India%3C/a%3E%20%3Ca%20class%3D%22mention%22%20data-mention%3D%22%23Coronavirus%22%20data-user-id%3D%22ZAlCyskRZCe9%22%20href%3D%22/topic/coronavirus%22%3E%23Coronavirus%3C/a%3E%20%3Ca%20class%3D%22mention%22%20data-mention%3D%22%23COVID-19%22%20data-user-id%3D%228E2LvVJbzOci%22%20href%3D%22/topic/covid-19%22%3E%23COVID-19%3C/a%3E%20%3Ca%20class%3D%22mention%22%20data-mention%3D%22%23MinistryofFinance%22%20data-user-id%3D%22kT77ERQksMpC%22%20href%3D%22/topic/ministry-of-finance%22%3E%23MinistryofFinance%3C/a%3E%26nbsp%3B