Covid-19 crisis: Now, FinMin is not so sure about a V-shaped recovery

Officials say people spending less owing to uncertainty

The finance ministry is reassessing its earlier optimism about a V-shaped economic recovery as people are spending less owing to extreme uncertainty induced by the Covid-19 pandemic.

“We keep devising projections based on high-frequency indicators. The progress seems gradual, and not necessarily it would follow our previous assessment of growth trajectory,” a senior ministry official told Business Standard.

The finance ministry in its monthly economic review last month had said the country was witnessing a V-shaped recovery, and attributed the steep 23.9 per cent contraction of the economy in the April-June quarter to the stringent coronavirus lockdown.

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