Industry body FICCI says that India’s gross domestic product (GDP) growth rate in the current financial year will be negative. The Ficci Economic Outlook Survey estimated that the country’s economy will go down by 4.5 percent in 2020-21. The survey said that the rapid increase in cases of corona virus has caused an economic and health crisis worldwide. FICCI’s latest survey has made major downward revisions in the growth rate estimates. FICCI had estimated the growth rate to be 5.5 percent in 2020-21 in the January 2020 survey. Economic activity has been severely affected by the lockdown implemented across the country to control the corona virus. However, restrictions are now gradually being relaxed.

Reserve Bank of India Governor Shaktikanta Das, while addressing the Banking and Economy Conclave of State Bank of India on Saturday, said that the Indian economy has now started returning to normalcy. In May, the Reserve Bank said that the country’s growth rate will remain in the negative zone in 2020-21. FICCI has done an economic scenario survey in June. Releasing the details, the Board of Industries said that it has considered the views of leading economists in the industry, banking and financial services sectors. The survey said that the average growth rate of GDP in 2020-21 will be negative 4.5 percent. It is estimated to have a minimum negative of 6.4 per cent or a negative 1.5 per cent in better condition. According to the survey, the average growth rate in the first quarter of the current financial year will be 14.2 percent below zero. This minimum negative can go down to 25 percent. Even in better condition it will be negative 7.4 percent. The Board of Industries said that when it comes to economic activities, the annual growth rate of agriculture and allied sector will be 2.7 percent.FICCI said that agriculture is the only sector where some silver lining is visible. The monsoon condition is fine and the reservoir level in the country is good. The survey said that the industry and service sectors will fall by 11.4 percent and 2.8 percent respectively in the current financial year. The survey says that investment is being affected by weak demand and under-utilization of capacity. Revival is likely to take longer due to the Kovid-19. FICCI said the situation in the consumer durables and FMCG sector is improving, but most companies are still operating at very low capacity. Lack of labor availability and demand is a major issue for companies.