All sectors of Indian economy, except farm, remain below 2019-20 levels
India’s Gross Domestic Product (GDP) in the first quarter (Q1) of 2021-22 grew 20.1 per cent, according to data released by the Union Ministry of Statistics and Programme Implementation (MoSPI) August 31, 2021.
April-June 2021 became the fourth consecutive quarter of economic growth, indicating a revival after two waves of the novel coronavirus disease (COVID-19) pandemic.
All the eight industry types that MoSPI took note of reported growth over the corresponding period of 2020-2021.
In the year-ago quarter — coinciding with the first national lockdown to prevent the pandemic — agriculture was the only “industry type” to report a growth of 3.5 per cent; the overall economy contracted 22.4 per cent.
The latest impressive growth is thus due to a very low base on which it has been measured — the reason why economists and industry experts have been betting for an over-20 per cent growth for the quarter.
When compared to the first three months of 2019-2020 — the last normal year — all sectors except agriculture continued to record slower growth.
Agriculture grew 4.5 per cent in the reported quarter — higher than the previous comparable period — to become the only sector to report higher gross value added (GVA) in the first quarters of three years in row: from Rs 4,49,390 crore in Q1 of 2019-2020 to Rs 4,65,280 crore in the corresponding period of 2020-2021 to Rs 4,86,292 crore this year.
GVA for the overall economy, at Rs 30,47,516, was more than the Rs 25,65,909 crore of the year-ago quarter, but nearly 10 per cent below the Rs 33,05,273 crore of 2019-2020.
Private consumption expenditure, at Rs 17, 83,611 crore, increased from previous year’s Rs 14, 94,524 crore, but remained below Rs 20, 24,421 crore — a worrying sign, given that it accounts for 55 per cent of the GDP. It indicated that people may not have the capacity to spend or are holding back due to uncertainties.
Government consumption expenditure, interestingly, shrunk to 13 per cent of GDP from 16.4 per cent in Q1 of the previous financial year.
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