News Analysis India

Tag: GDP

  • Debt-to-GDP ratio swells to 58.73 per cent for FY 2020-21

    By Express News Service
    NEW DELHI:  In another sign of the country’s worsening fiscal situation, the Central government’s total debt at the end of financial year 2020-21 has reached 58.73 per cent of the GDP, the highest since 2007-08 when the debt-to-GDP ratio was 58.86 per cent.

    The government’s total debt reached Rs 116.2 lakh crore as on 31 March 2021, registering a 6.36 per cent jump in the January-March quarter, according to a finance ministry report. At the end of December 2020, total debt stood at Rs 109.2 lakh crore.

    In 2019-20, the ratio was 48.6 per cent. The government’s total market borrowings also exceeded the revised budget estimate of Rs 12.74 lakh crore for FY21. The government had to borrow Rs 13.20 lakh crore to finance a part of the fiscal deficit of Rs 18.21 lakh crore. Rest of the fiscal deficit is financed by money collected through small savings schemes and external assistance. 

    During the January-March quarter of 2020-21, the Centre issued government bonds worth Rs 3,20,349 crore against Rs 76,000 crore in the year-ago quarter. Consequently, the rate at which the government borrowed during the fourth quarter also increased from 5.68 per cent in the October-December 2020 quarter to 5.80%. 

    “Yields on government securities hardened in the secondary market due to increase in supply of G-secs during the quarter. Further, hardening of yields was more on the short end of curve due to increase in weekly borrowing and also announcement of resumption of normal liquidity operations by the RBI,” the Finance Ministry report said. 

    Public debt

    The country’s total public debt (Centre and States) is likely to have touched 90 per cent of the GDP in 2020-21, the highest ever recorded. In 2019-20, the total public debt to GDP ratio was 70 per cent.

  • Congress leader Rahul Gandhi slams Modi govt for ‘ruining’ country’s economy

    By ANI
    WAYANAD: Congress leader Rahul Gandhi on Thursday targeted Prime Minister Narendra Modi-led government for allegedly “ruining” the country’s economy.

    In a tweet, the Congress MP said: “Mr Modi’s governance is a lesson in how to ruin one of the world’s fastest-growing economies.”

    He has been actively criticising the ruling government over the issues of economy and employment in the country.

    During the COVID-19 lockdown, Gandhi had shared a report by Oxfam on the alleged increase in wealth of Indian billionaires saying, “This is what happens when the Prime Minister runs a country in the sole interest of 3-4 crony capitalists.”

    The Congress leader arrived in Kerala on Wednesday for the two-day visit ahead of the Assembly elections in the state scheduled for April-May.

    Earlier, he was on a three-day visit to the western belt in Tamil Nadu where he interacted with farmers, business people, weavers and the general public. During his visit, the politician said that the major economic policies of the present central government like Goods and Services Tax and demonetisation destroyed micro, small and medium enterprises (MSME) in the country.

  • GDP contraction at -7.5% in Q2, India technically enters recession

    The Gross Domestic Product (GDP) for the second quarter (Q2) from July to September contracted 7.5%, government data showed on Friday.

    “GDP at constant (2011-12) prices in Q2 of 2020-21 is estimated at Rs 33.14 lakh crores, as against Rs 35.84 lakh crores in Q2 of 2019-20, showing a contraction of 7.5% as compared to 4.4% growth in Q2 of 2019-20,” the Ministry of Statistics & Programme Implementation said.

    Though this is a rebound from earlier quarter but with this contraction Indian economy has hit technical recession for the first time.

    According to the Ministry of Statistics and Programme Implementation, gross value added (GVA) came in at minus 7%. The economy had contracted by 23.9% in the April to June quarter (Q1 FY21), marking the first contraction in more than 40 years as COVID-19 pandemic compressed consumer demand and private investments.

    “GDP at Constant (2011-12) Prices in Q2 of 2020-21 is estimated at Rs 33.14 lakh crore, as against Rs 35.84 lakh crore in Q2 of 2019-20, showing a contraction of 7.5 per cent as compared to 4.4 per cent growth in Q2 2019-20,” said the Ministry of Statistics and Programme Implementation in a statement.

    ” Quarterly GVA at Basic Prices at Constant (2011-12) Prices for Q2 of 2020-21 is estimated at Rs 30.49 lakh crore, as against Rs 32.78 lakh crore in Q2 of 2019-20, showing a contraction of 7 per cent,” it added.

    The statement said during the quarter trade, hotels, transport & communication saw a dip of -15.6 per cent while public administration, defence and other services by -12.2 per cent. The financial, real estate and professional services sector contracted by 8.1 per cent and construction by 8.6 per cent.

    Some sectors have bounced back with resumption of economic activities. The electricity, gas, water supply and other utility services have shown a growth of 4.4 per cent; agriculture, forestry and fishing sector at 3.4 per cent and manufacturing sector showed a marginal growth of 0.6 per cent.

    The economy was already slowing before the pandemic struck, growing only 4.2 per cent in the last fiscal year, its slowest pace in 11 years.