Road to recovery

Hopeful signs in data, but medium-term outlook uncertain

The third quarter of the current financial year saw the end of the Covid-induced contraction for the Indian economy. According to the latest official data, gross domestic product (GDP) during October-December 2020 expanded by 0.4 per cent, year-on-year, at constant prices. Gross value added (GVA), which is a better gauge of economic activity, expanded by 1 per cent during the same period, compared to a decline of 22.4 per cent and 7.3 per cent in the first and the second quarter, respectively. Recovery in the third quarter was aided by an expansion in the agriculture sector at 3.9 per cent,