Finance Secretary Ajay Bhushan Pandey is optimistic about the current trends as far economic recovery is concerned and in a webinar on September 4 said that early signs of revival are clearly visible. However, he stressed that one needs to keep a watch on how the situation pans out in the coming months, before making any predictions.
Expressing his views on the economy, Pandey said: "The decline in first quarter GDP numbers is due to two months of complete lockdown. Initial indicators for July and August show some recovery. GST collections are back to 87 percent of last year's collections. So we are seeing the same recovery path through rising numbers of e-way bills. Thus, we can say that we can see a recovery path."
Nonetheless, he was a little cautious as he added that the unpredictable nature of COVID-19 can have a negative impact here.
"COVID is behaving unpredictably. We have to closely watch the situation as partial lockdowns are coming and going. The economy did revive up to 87 percent in July and August. We have to learn to live with the economic downturn and uptick until the time the virus behaves like this. We might see some decline in economic activity, if a fresh spike comes, so that is unpredictable," Pandey added.
He also suggested that for the time-being all economic participants will have to learn to live with this unpredictable nature of virus.
Pandey stressed that an important indicator of economic recovery is UPI transactions, which have risen to a record highs. This is an indicator of economic recovery as people are trying to conduct transactions for businesses and personal reasons.
"One quarter figures cannot be anticipated with two months of complete lockdown. But in the last two months, indicators are showing the recovery path. But we need to watch out the coming months crucially," Pandey said and noted that one quarter decline should not worry much as an uptick is coming in the following months.
India's GDP in the first quarter of FY21 contracted by 23.9 percent, data released by the Central Statistical Organisation (CSO) showed.
First Published: Sept 4, 2020 7:58 PM IST
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