India's GDP growth will contract in the first half of 2020-21, Reserve Bank of India (RBI) governor Shaktikanta Das said on Thursday. For the year 2020-21 as a whole, the country's real GDP growth which doesn't include the inflation rate, is estimated to be negative, Das said.

RBI announced the decisions of the Monetary Policy Committee (MPC) on Thursday. The financial regulator has kept the repo rate and reverse repo  rate unchanged at 4% and  3.3%, respectively. 

"The economic activity in India has started to recover, but surges of 'fresh infections have forced fresh lockdowns, hence several high-frequency indicators have levelled off," Das said.

The committee has proposed several regulatory and developmental measures. These include enhancing liquidity support for financial markets, easing financial stress caused by COVID-19 while strengthening credit discipline, improving the flow of credit, deepening digital payment systems and facilitating innovations by leveraging technology.