GDP growth slips to 3.1% as COVID-19 further weakens sluggish demand

India’s economic growth slipped to 3.1 per cent in the January-March quarter of 2019-20 (Q4 FY20) as COVID-19 pandemic further compressed consumer demand and private investments, government data showed on Friday (May 29).

The gross domestic product (GDP) had expanded by 5.7 per cent in the corresponding quarter of 2018-19, according to data released by the National Statistical Office (NSO) on Friday.

“In view of the global COVID-19 pandemic and consequent nationwide lockdown measures implemented since March 2020, the data flow from the economic entities has been impacted,” said the Ministry of Statistics and Programme Implementation in a statement.

In 2019-20, the Indian economy grew by 4.2 per cent against 6.1 per cent expansion in 2018-19.

The government imposed lockdown on March 25 to combat COVID-19. However, slowing down of business activities across the world in January-March impacted the Indian economy.

The resultant slowdown in household spending and corporate investment will emerge when the numbers for the current quarter (April to June) are collated to reflect actual distress in the economy.

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The Reserve Bank had pegged the GDP growth for 2019-20 at 5 per cent as projected by the NSO in its first and second advance estimates released earlier this year in January and February respectively.

China’s economy shrank by 6.8 per cent in January-March 2020 due to the impact of coronavirus infection.

The next release of quarterly GDP estimates for April to June quarter (Q1 FY21) will be on August 31, said the Ministry of Statistics and Programme Implementation.

(With inputs from agencies.)