New Delhi/Mumbai, Feb 23 Healthy festive season sales along with low base and high corporate savings are expected to lift India out of the technical recession spiral in Q3FY21.
Besides, healthy performance of the agricultural sector as well as a lagged recovery in contact-intensive parts of the services sector such as aviation and hospitality are expected to give an upward push to the GDP growth rate.
A poll of economists and industry experts conducted by showed that majority of them expect a flat-to-positive growth in GDP during Q3FY21.
Consequently, even with a minute growth, India would have exited the recessionary phase, even though the long-term impact of the pandemic will still to hamper the growth.
"We expect India's GDP to grow by 0.7 per cent in Q3FY21, indicating an end to the recession. Festive sales, government spending and a low base aided the exit from the recession," said Aditi Nayar, Principal Economist, ICRA.
In financial parlance, an economy is said to have entered a technical recession after it consistently remains in the negative output territory for two subsequent quarters. This trend underscores the reduction in purchasing power along with lower tax collection for the government, likely defaults on debt and falling Capex spends.
"Strong corporate earnings and pickup in other lead activity indicators should support a sequential recovery in growth, implying that the GDP will likely be back in the positive territory by Q3FY21," said Madhavi Arora, Lead Economist, Emkay Global.
In November 2020, the data furnished by the National Statistical Office
( With inputs from IANS )
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