Something about the country’s fiscal climate just does not make us admit the lessened tension for the second successive time. Somehow, going through the NSO chart published on the afternoon of November 27, people who understood the graphical line of the economy felt way more uncomfortable than drinking down a sip of a small cup of kadak chai in the morning.
Experts think that our country’s shrinking economy is more or less in recession. In economic terms, a recession is usually defined as a business cycle contraction when there is persisting a general weakening in economic activity.
Why does it actually persist? It commonly occurs when there is a widespread fall in spending (an adverse demand shock). Further, a recession is when the GDP growth rate of a country is negative for two consecutive quarters or more. But a recession can be gauged even before the quarterly GDP reports are out, based on key economic indicators like manufacturing data, decline in incomes, employment levels etc., Business Standard wrote.
Were there similar scenes existed at the months from July to September this year? According to the recent data circulated by the National Statistical Office (NSO), our economy has receded for the second straight quarter through September, thereby recording a 7.5% contraction in its GDP in July-September.
This latest vital data is a significant restoration over the unprecedented 23.9% year-on-year contraction in April-June this year, due to ravage caused by the pandemic-induced lengthy lockdown.
Nonetheless, there have been two consecutive quarters of contraction. Though, it has been noted as a good indication, the concern is already there. We seem to solace us by saying that this is the ongoing condition across most global economies. Once of the factors for concern could be that even with a smaller rate of contraction as described in relation to the first quarter, the Indian economy remains one of the worst performers among major economies, as Indian Express reported.