India’s gross domestic product (GDP) is expected to contract by 8 percent in 2020-21, according to the latest round of FICCI’s Economic Outlook Survey.
The annual median growth forecast by the industry body is based on responses from leading economists representing the industry, banking, and financial services sector.
The survey was conducted in January. The median growth forecast for agriculture and allied activities has been pegged at 3.5 percent for 2020-21. “Agriculture sector has exhibited significant resilience in the face of the pandemic. Higher rabi acreage, good monsoons, higher reservoir levels, and strong growth in tractor sales indicate continued buoyancy in the sector,” FICCI stated on the survey findings.
However, the industry and services sector, which were most severely hit due to the pandemic induced economic fallout, are expected to contract by 10 percent and 9.2 percent respectively during 2020-21.
The industrial recovery is gaining traction, but the growth is still not broad-based. The consumption activity did spur during the festive season as a result of pent-up demand built during the lockdown but sustaining it is important going ahead, the survey said.
Besides, it observed that some of the contact intensive service sectors like tourism, hospitality, entertainment, education, and the health sector are yet to see normalcy.