India GDP Records Worst Historic Contraction of 23.9% in April-June Quarter Though largely along the lines of market expectations, this contraction is the biggest ever on record and the first contraction since the government started releasing quarterly GDP numbers in FY 1997-98

By Shipra Singh

You're reading Entrepreneur India, an international franchise of Entrepreneur Media.


As a result of the Covid-19 induced lockdowns, Indian economy shrank by a massive 23.9 per cent in the April-June quarter of FY 2020-21, as per data from Ministry of Statistics and Programme Implementation (MOSPI) released on Monday.

Though largely along the lines of market expectations, this contraction is the biggest ever on record and the first contraction since the government started releasing quarterly GDP numbers in FY 1997-98.

Further, in terms of gross value added (GVA), GDP plummeted 22.8 per cent from the last year.

"Quarterly GVA at Basic Price at Constant (2011-12) Prices for Q1 of 2020-21 is estimated at INR 25.53 lakh crore, as against INR 33.08 lakh crore in Q1 of 2019-20, showing a contraction of 22.8 per cent," MOSPI stated.

India's GDP growth rate has been consistently dropping in the last few quarters, only to be pushed into a free fall by Covid-19 pandemic.

India's Falling GDP Growth Over the Past Few Quarters

Construction, Hotels and Manufacturing Among Worst Hit

Looking at the sector-wise breakup, construction industry is the worst hit having recorded a massive contraction of 50.3 per cent. After construction, hotels and transportation recorded second biggest fall of 47 per cent, followed by manufacturing contracting by 39.3 per cent.

Sector-Wise Break-up

The lockdown restrictions through March and April not only halted economic activities, but also impacted the government's data collection mechanisms. "In these circumstances, the usual data sources were substituted by alternatives like GST, interactions with professional bodies etc. and which were clearly limited," MOSPI said in its official statement.

Challenges in data collection of other macro-economic indicators, such as Index of Industrial Production (IIP) and Consumer Price Index (CPI), will also impact these GDP estimates. Therefore, estimates are likely to undergo revisions for the aforesaid causes in due course, MOSPI said.

Shipra Singh

Entrepreneur Staff

Freelance Journalist

Now a freelance journalist, ealier steered the Wealth section on the Entrepreneur website, covering everything finance. Previously a personal finance reporter at The Economic Times and Outlook Money.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Related Topics


International Security Firm Welcomes Female India Native to an Essential Leadership Position

Yasmin Brar has been appointed as the Operations Strategy Director, a role that underscores the company's commitment to innovation, expansion, and strategic management

News and Trends

5 Things Uber CEO Khosrowshahi Did During His India Visit

Dara Khosrowshahi has managed the company's business in more than 70 countries around the world since 2017, and is on his third visit to India.

News and Trends

SIDBI, Bihar Start-up Fund Trust Ink Pact For Enhancing Startup Ecosystem in Bihar

The fund shall not invest directly into start- up companies, instead it shall contribute to the corpus of SEBI registered Alternative Investment Funds, which in turn shall invest in startups.

Business Ideas

55 Small Business Ideas to Start in 2024

We put together a list of the best, most profitable small business ideas for entrepreneurs to pursue in 2024.

Business News

Airbnb Renter Discovers Hidden Door, Says Police Confirm There's a Secret Unit Upstairs With 'Surveillance': 'A Terrifying Experience'

One bride-to-be was in for a not-so-welcome surprise when she discovered a secret door in her Airbnb rental.

Business News

Here Are 3 Strategies Startup Founders Can Use to Approach High-Impact Disputes

The $7 billion "buy now, pay later" startup Klarna recently faced a public board spat. Here are three strategies to approach conflict within a business.