Krishnamurthy Subramanian, chief economist at the Ministry of Finance, said India's economy was set for a "V-shaped" recovery and should perform better in the coming quarters as indicated by a pickup in rail freight, power consumption and tax collections. Consumer spending - the main driver of the economy - dropped 31.2% year-on-year in April-June compared to a 2.6% fall in the previous quarter, data showed, while capital investments were down 47.9% compared to a 2.1% rise in the previous quarter. Continuing restrictions on transport, educational institutions and restaurants have hit manufacturing, services and retail sales, while keeping millions of workers out of jobs. Manufacturing has already entered recession as output fell 39.3% in April-June after falling 1.4% in the previous quarter, and construction and trade services plunged by around 50%. Still, Rupa Rege Nitsure, group chief economist at L&T Financial Holdings, said the government will have to take more steps to boost the economy overall.

Source: bd News24 August 31, 2020 15:22 UTC