Indian economy shrinks 7.7% in fiscal 2020-21 amid pandemic

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A farmer works in his paddy field as smoke rises from brick kilns on the outskirts of Gauhati, India, Friday, Jan. 29, 2021. India's economy contracted by 7.7% in the 2020-21 financial year, battered by the coronavirus pandemic, according to a report released Friday. Agriculture remained the silver lining with 3.4% growth, the report said. (AP Photo/Anupam Nath)

NEW DELHI – India's economy contracted by 7.7% in the 2020-21 financial year, battered by the coronavirus pandemic, according to a report released Friday.

The government survey estimates the economy, previously one of the fastest growing among major economies, will bounce back, growing 11% in the fiscal year that begins in April.

Finance Minister Nirmala Sitharaman presented the report to Parliament on Friday. She will present the national budget for 2021-22 on Monday.

Agriculture remained the silver lining with 3.4% growth, the report said.

It said the recovery would be seen in a resurgence in demand for power and steel, rail freight and tax collections on goods and services

``The economy would take two years to reach and go past the pre-pandemic level. These projections are in line with the International Monetary Fund estimate of real GDP growth of 11.5% in 2021-22 for India and 6.8% in 2022-23,” it said.

India’s economy contracted at a 7.5% annual pace in the July-September quarter following a record slump of nearly 24% in the previous three months that pulled the country into a recession. India last suffered a recession in 1979-80 after an oil shock.

A country enters a technical recession if its economy contracts for two successive quarters.