COVID-19 Impact: GDP growth dips to 3.1% in Jan-Mar quarter, slowest growth in 8 years; economy grows at 4.2% in FY20

Economic growth slipped to 3.1 percent in the January-March quarter of 2019-20 showing impact of COVID-19 pandemic, the slowest growth in at least eight years, official data showed on Friday. The coronavirus pandemic has weakened the already declining consumer demand and private investment.The gross domestic product (GDP) had expanded by 5.7 percent in the corresponding quarter of 2018-19, according to data released by the National Statistical Office (NSO) on Friday.In 2019-20, the Indian economy grew by 4.2 percent against 6.1 percent expansion in 2018-19.The government imposed lockdown on 25 March to combat COVID-19. However, slowing down of business activities across the world in January-March impacted the Indian economy.The Reserve Bank had pegged the GDP growth for 2019-20 at 5 percent as projected by the NSO in its first and second advance estimates released earlier this year in January and February respectively.China's economy shrank by 6.8 percent in January-March 2020 due to the impact of coronavirus infection.Click here to follow LIVE updates on coronavirus outbreakPrime Minister Narendra Modi has maintained the lockdown ordered on 25 March to curb the spread of COVID-19 in the world’s second-most populous country, though many restrictions were eased for manufacturing, transport and other services from 18 May.The full impact of the lockdown on manufacturing and services will become more apparent in the June quarter, with Goldman Sachs predicting a 45 percent contraction from a year ago, Reuters said.Economists expect the fiscal year that began in April will see the worst economic contraction in four decades.“Economic activity will face ongoing disruption over the next year as the country transitions to a post-COVID-19 world,” the rating agency S&P said on Thursday, cutting its 2020/21 forecast to a 5% contraction.Weather forecasts for normal monsoon rains are in farmers’ favour at least, giving hope that the rural sector can help support the millions of migrant workers who returned to their villages from the cities when the lockdown began.The number of coronavirus-affected people in India has crossed 158,000 with 4,531 deaths, with an average daily jump of 6,000 cases in the last one week.--With inputs from agencies