Chennai: In some positive news that gives hope amid these tough times, PHD Chamber of Commerce and Industry (PHDCCI) said it expects India’s GDP to contract by 7.9 per cent in the current financial year and grow by 7.7 per cent in 2021-22. It also said that the worst is over and the economy is on the verge of a slow recovery.
However, PHDCCI stated that unemployment remains a key challenge to be addressed by the government.
The chamber drew the conclusions based on its analysis of 25 high-frequency economic indicators which point out that there has been a pickup in business normalisation.
In a report, it said that the unemployment rate still remains a worry as it worsened to 8.3 per cent in August from 7.4 per cent in July.
“Going ahead, India should focus on moving away from imports from China, divert trade towards friendly economies, build domestic capacities and significantly scale-up indigenous production with a thrust to become self-reliant,” PHDCCI said.
The industry body said also that efforts should be made to diversify the portfolio of export products in terms of more countries and also in terms of more products, where India has a core competence.
According to PHDCCI president Sanjay Aggarwal, on the back of various reforms undertaken by the government during the last six months, economic recovery has become visible in the high-frequency indicators.
The chamber suggests that the government should prioritise demand creation measures to attain a positive growth trajectory in the third and fourth quarters of the current financial year ending March 2021.