GDP grows 0.4 per cent in December quarter, India exits technical recession.

India’s GDP grew 0.4% in Q3 of FY21, helping the economy out of a technical recession after two consecutive quarters of degrowth. The economy witnessed a GDP contraction of 24% and 7.5% in Q1 and Q2 of FY21, respectively. GDP at constant (2011-12) prices in Q3 of 2020-21 is estimated at Rs 36.22 lakh crore, as against Rs 36.08 lakh crore in Q3 of 2019-20. The growth in GDP during 2020-21 is estimated at (-)8% as compared to 4% in 2019-20, as per the press release. FY21 GVA growth is seen at (-)6.5%. Today’s GDP numbers, along with January business activity, show indications of a recovery despite an uptick of Covid-19 cases in the past few weeks. Services activity rose for the fourth month in January, while exports and factory activity also continued to expand. The Reserve Bank of India (RBI) sees India growing at 10.5% during FY22, while the International Monetary Fund (IMF) expects India to grow at 11.5%. The Economic Survey forecasted GDP to rise 11% during the same period.

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