{"id":130913,"date":"2021-09-02T19:55:36","date_gmt":"2021-09-02T14:25:36","guid":{"rendered":"https:\/\/blog.forumias.com\/?p=130913"},"modified":"2021-09-03T11:37:10","modified_gmt":"2021-09-03T06:07:10","slug":"fleeting-cheer-on-impact-of-covid-on-gdp-and-the-future-scenario","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/fleeting-cheer-on-impact-of-covid-on-gdp-and-the-future-scenario\/","title":{"rendered":"Fleeting cheer (On impact of COVID on GDP and the future scenario)"},"content":{"rendered":"\n

Source: <\/strong>This post is based on the article \u201cFleeting cheer<\/strong>\u201d published in The Hindu<\/strong> on 2nd September 2021<\/strong>.<\/p>\n

Syllabus<\/strong>: GS3 – Economy<\/p>\n

Relevance:<\/strong> Impact of the pandemic on growth<\/p>\n

Synopsis<\/strong>: The latest GDP estimates show that national output rebounded in Quarter 1<\/strong>. However, the numbers show a different picture when compared with the pre-pandemic first quarter of fiscal 2019-20.<\/p>\n

Introduction<\/strong><\/h5>\n

National Statistical Office<\/strong> data shows GDP expanded 20.1% from a year earlier. All the eight industries spanning the broad agriculture, manufacturing and services categories posted positive growth. Also, the gross value added grew by 18.8%.<\/p>\n

How the second wave has impacted the economy?<\/strong><\/h5>\n

First<\/strong>, GDP at constant prices was estimated at \u20b932.38-lakh crore, a 16.9% contraction from January-March\u2019s \u20b938.96-lakh crore and more than 9% of the \u20b935.66-lakh crore in April-June 2019.<\/p>\n

Second<\/strong>, with the exceptions of electricity and other utility services and the non-contact intensive services grouping of financial, real estate and professional services, all other six industries posted double-digit quarter-on-quarter contractions.<\/p>\n

Third<\/strong>, private consumption spending showed year-on-year growth of 19.3% but still shrinking by 17.4% from the preceding three months.<\/p>\n

Fourth<\/strong>, government consumption expenditure which has helped shore up the economy in the past, contracted 4.8% from a year earlier and 7.6% from the previous quarter.<\/p>\n

What opportunities lie ahead for the economy?<\/strong><\/h5>\n

Most states have gradually eased their localized second wave restrictions.<\/p>\n

Exports<\/strong> have been one of the bright spots as the U.S. and other western economies have posted economic recoveries.<\/p>\n

Manufacturing<\/strong> has surged almost 50% year-on-year. As per Manufacturing Purchasing Managers\u2019 Index, the manufacturing sector experienced a second straight month of increase in production.<\/p>\n

What are some future challenges?<\/strong><\/h5>\n

Rising raw material costs<\/strong>: As per the PMI survey, rising raw material costs<\/strong> have been forcing manufacturers to either absorb the impact or raise prices. It is risking the prospect of an already weak demand.<\/p>\n

Freeze on hiring<\/strong>: According to IHS Markit, uncertainty has led companies to freeze hiring<\/strong>. With monsoon rains in deficit, agricultural output and wider rural consumption also face a likely downturn.<\/p>\n","protected":false},"excerpt":{"rendered":"

Source: This post is based on the article \u201cFleeting cheer\u201d published in The Hindu on 2nd September 2021. Syllabus: GS3 – Economy Relevance: Impact of the pandemic on growth Synopsis: The latest GDP estimates show that national output rebounded in Quarter 1. However, the numbers show a different picture when compared with the pre-pandemic first… Continue reading Fleeting cheer (On impact of COVID on GDP and the future scenario)<\/span><\/a><\/p>\n","protected":false},"author":10316,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[1230,9],"tags":[216],"class_list":["post-130913","post","type-post","status-publish","format-standard","hentry","category-9-pm-daily-articles","category-public","tag-gs-paper-3","entry"],"jetpack_featured_media_url":"","views":{"total":0,"cached_at":"","cached_date":1704709343},"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/130913","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10316"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=130913"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/130913\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=130913"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=130913"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=130913"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}