India’s economy is expected to contract 7.7% in the current fiscal from a growth rate of 4.2% a year ago, according to the first advance estimates of the GDP released by the Ministry of Statistics & Programme Implementation (MoSPI).

Largely led by the coronavirus pandemic, the contraction in the economy is likely to bring growth to the top of the finance minister Nirmala Sitharaman’s agenda as she readies to present the budget next month.

The government has already indicated that it would increase spending on new roads, ports and provide incentives for manufacturers to pump up the economy.

The estimate of the GDP by the Central Statistics Office (CSO) matches the Reserve Bank of India’s (RBI) revised estimate of 7.5%.

“Real GDP or GDP at Constant Prices (2011-12) in the year 2020-21 is likely to attain a level of Rs 134.40 lakh crore, as against the provisional estimate of GDP for the year 2019-20 of Rs 145.66 lakh crore, released on 31 May 2020,” the MoSPI release said.

The Real GVA at Basic Prices is estimated at Rs 123.39 lakh crore in 2020-21 versus Rs 133.01 lakh crore a year ago, thereby showing a contraction of 7.2%.

MoSPI estimates the agriculture sector growth for FY 2020-21 at 3.4% against 4% in the earlier year. Also, mining sector estimate stood at (-)12.4% for 2020-21 from 3.1% in 2019-20.

The estimate for manufacturing sector in FY 2020-21 is at (-)9.4% compared to 0.03% a year ago. During the same period, construction sector is estimated to rest at (-)12.6% vs 1.3%.

The economy contracted by a record 23.9% in the fiscal first quarter following a national lockdown to control the spread of the coronavirus and by 7.5% in the September quarter.

For the December quarter, the expectancy is economy would see a marginal positive growth as most Covid-19 restrictions have been lifted.