GDP’s progress before and after Contagion

Prof. S. Thilak, Assistant Professor, SIMS

 

India’s economy slowdown to 3.1 percent in Q4 because of the coronavirus pandemic superimposed a prolonged slowdown. The fact is that the GDP development estimates have outperformed most estimates made by different financial specialists and rating agencies, the government has left a condition that the figures can be updated as the current data is lacking. With the arrival of Q4 GDP development, the entire year 2019-20 GDP development remained at 4.2 percent. The government has revised down the GDP development in Q1, Q2, and Q3 to 5.2 percent, 4.4 percent, and 4.1 percent respectively. As India goes through the path of financial vulnerability, the GDP growth in the final quarter gets significant as it incorporates the figures for multi week of lockdown. It is also expected that current data will help to determine the impact of the pandemic more clearly. Meanwhile, the development pace of eight core industries for April 2020 fell by 38.1 percent, compared with a fall of 9 percent in March 2020. The yield of power fell by 22.8 percent, while the yield of cement fell by 86 percent; steel by 84 percent; manure by 4.5; treatment facility by 24.2 percent; raw petroleum by 6.4 percent; and coal by 15.5 percent in April 2020. Even before the coronavirus cases started to surge in India, the country’s economy was struggling through a prolonged economic slowdown and lockdown. Here are few sectors which indicates the growth level of the GDP before the pandemic that are represented below.

Agriculture Sector

Agriculture and allied parts like forest, logging and fishing represented 17% of the GDP, the area utilized 49% of its total workforce in 2014. Agribusiness represented 23% of GDP, and utilized 59% of the nation’s total workforce in 2016. As the Indian economy has enhanced and developed, Agriculture’s commitment to GDP has consistently declined from 1951 to 2011, yet it is as the nation’s biggest business source and a critical bit of its general financial turn of overall socio-economic development.  India is the biggest maker of milk, jute and seeds, and has the world’s second-biggest cattle population with 170 million beings in 2011. It is the second-biggest producer of rice, wheat, sugarcane, cotton and groundnuts, just as the second-biggest foods grown from the ground maker, representing 10.9% and 8.6% of the fruits and vegetables. India is additionally the second-biggest maker and the biggest buyer of silk, producing 77,000 tons in 2005. India is the largest exporter of cashew bits and cashew nutshell fluid (CNSL). Foreign exchange earned by the nation through the fare of cashew pieces during 2011–12 came to ₹4,390 crore (₹ 43.9 billion) based on statistics from the Cashew Export Promotion Council of India (CEPCI). 131,000 tons of portions were sent out. There are around 600 cashew preparing units in Kollam, Kerala. India’s food grain creation stayed stale at around 252 million tons (MT). harvest years (July–June). India trades a few farming items, for example, Basmati rice, wheat, grains, flavors, new organic products, dry natural products, wild ox hamburger meat, cotton, tea, espresso and other money crops especially to the Middle East, Southeast and East Asian nations. around 10 percent of its fare profit originate from this exchange.

Manufacturing and Industry Sector

Industry represents 26% of GDP and utilizes 22% of the total workforce. As per the World Bank, India’s industrial manufacturing’s GDP yield in 2015 was sixth biggest on the planet on current US dollar basis ($559 billion), and ninth biggest on inflation balanced consistent in 2005. The Industrial sector experienced critical changes because of the 1991 monetary changes, which removed import limitations, led to the privatization of certain government-owned public-sector industries, liberalized the foreign direct investment (FDI) regime, improved infrastructure and led to an expansion in the production of fast-moving consumer goods. Post-advancement, the Indian private part was confronted with expanding local and foreign competition. including the danger of less expensive Chinese imports. It has since dealt with the change by pressing costs, patching up the board, and depending on modest work and new innovation. However, this has also reduced employment generation, even among smaller manufacturers who previously relied on labour-intensive processes.

Electricity Sector

Primary energy consumption of India is the third-biggest after China and the US with 5.3% worldwide. Coal and crude oil together record for 85% of the primary energy consumption of India. India’s oil reserves meet 25% of the nation’s local oil request. As of April 2015, India’s complete demonstrated unrefined petroleum holds are 763.476 million metric tons, while gas saves remained at 1,490 billion cubic meters (53 trillion cubic feet). Oil and flammable gas fields are found seaward at Bombay High, Krishna Godavari Basin and the Cauvery Delta, and inland predominantly in the conditions of Assam, Gujarat and Rajasthan. India is the fourth-biggest shopper of oil and net oil imports were about ₹820,000 crore (US$110 billion), which adversely effected the nation’s current account deficiency. The petroleum industry in India mostly consists of public sector companies such as Oil and Natural Gas Corporation (ONGC), Hindustan Petroleum Corporation Limited (HPCL), Bharat Petroleum Corporation Limited (BPCL) and Indian Oil Corporation Limited (IOCL). There are some major private Indian companies in the oil sector such as Reliance Industries Limited (RIL) which operates the world’s largest oil refining complex.

Infrastructure Sector

India’s Infrastructure and transport sectors contributes about 5% of its GDP. India has a road network of more than 5,472,144 kilometers (3,400,233 mi) starting at 31 March 2015, the second-biggest road network in the world just behind the United States. At 1.66 km of streets per square kilometer of land, the quantitative density of India’s road network is higher than that of Japan (0.91) and the United States (0.67), and far higher than that of China (0.46), Brazil (0.18) or Russia (0.08). India’s road networks are a blend of present days expressways and thin, unpaved streets, and are being improved and 87.05% of Indian roads were cleared. India has the most reduced kilometer-road density per 100,000 individuals among G-27 nations, leading to traffic congestion. It is redesigning its foundation, India had finished more than 22,600 kilometers (14,000 mi) of 4-or 6-path parkways, associating the greater part of its significant assembling, business and social focuses. India’s street foundation conveys 60% of cargo and 87% of traveler traffic.