Worst over for Indian economy, country to see V-shaped recovery, says finance ministry
· The worst is over for the Indian economy and it is on path of a V-shaped economic recovery, said the finance ministry in its monthly economic outlook for August released Friday.
· The report comes days after data from the National Statistical Office showed that the Indian economy contracted by a record 23.9 per cent in the April-June quarter as the pandemic and the lockdown brought all economic activity to a complete halt.
· “With India unlocking, the worst seems to be behind us as high-frequency indicators show an improvement June onwards, from the unprecedented trough the economy had hit in the first quarter. Readings of economic data suggest growing convergence with previous year’s activity levels on several indicators,” the report said.
· “Broad-based resurgent growth in several high frequency indicators such as PMI Manufacturing, eight core industries, e-way bills, kharif sowing, power consumption, railway freight, cargo traffic and passenger vehicle sales augur well for prospects of growth recovery,” it added.
· It pointed out that rural demand is strengthening and sectors like construction and manufacturing are seeing a revival.
· Construction, manufacturing, and hotels and transport were among the worst hit sectors, which contracted by 50 per cent, 39 per cent and 47 per cent, respectively in the April-June period.