Monetary policy: Taming Covid-19 key to soften GDP fall, says RBI

High consumer inflation likely till September

India’s economy would contract in the current financial year, the Reserve Bank of India’s Monetary Policy Committee (MPC) said on Thursday, adding that the fall could be contained in the latter part of FY21 if Covid-19 was arrested soon. 

The country's gross domestic product (GDP) growth had fallen to 3.1 per cent in the three months ended March 2020, the slowest in 44 quarters. 

The MPC in its statement said a revival in coming months would come from the “robust” rural side, “buoyed by progress in kharif sowing”. Agriculture forms less than a fifth of GDP. 

Noting that there was “extreme” uncertainty in