India’s economic growth picked up in the first quarter of this year from the previous three months, but economists have grown pessimistic about the second quarter after a huge second wave of COVID-19 infections hit the nation last month.
GDP grew 1.6 percent in the first quarter compared with the same period last year, mainly driven by manufacturing sector growth, data from the Indian Ministry of Statistics and Programme Implementation showed yesterday.
ANNUAL CONTRACTION
That compared with revised growth of 0.5 percent in the previous three months and 1.0 percent according to a Reuters poll of economists.
The government also revised its annual GDP estimates for the fiscal year, predicting a 7.3 percent contraction, less than its earlier estimate of minus-8.0 percent.
A slow vaccination drive and local restrictions after a massive second wave of infections and deaths across the nation have hit economic activities, such as retail, transport and construction, while putting millions out of work.
COLLAPSE IN DEMAND
India as of yesterday had recorded more than 28 million COVID-19 infections, behind only the US, and 329,100 deaths, although the rise in cases has begun to slow.
Economists said the Indian economy, which was facing a slowdown even before the pandemic, might now experience a collapse in consumer demand, which accounts for more than 55 percent of the overall economy, as household incomes and jobs have declined.
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