India returning to normal: PM Narendra Modi

New Delhi: Prime Minister Narendra Modi on Thursday said business activity in India is fast returning to normal levels with consumption and demand fast approaching pre-COVID levels as visible in macro data on power, fuel and other consumption.

India faced a recession-like scenario after a national lockdown was imposed on March 25 to the curb spread of coronavirus. The lockdown, that has continued in various phases into June, albeit with significant easing of restrictions, resulted in severe disruption of industrial production and consumer spending, with GDP growth forecast to contract sharply.

With the easing of lockdown conditions, business activity was fast returning to normal levels, Modi said. Speaking at the launch of commercial coal mining, he said "consumption and demand are fast approaching pre-COVID levels". He cited spurt in power generation and consumption as well as demand for petroleum products during the last week of May and first week of June to buttress his point. Also, road and highway toll collection in June has reached 70 per cent of the pre-COVID levels of February, while railway freight tariff in May has seen an improvement of 26 per cent over April. Digital transactions too have witnessed a rise. "These indicators point to Indian economy fast preparing to bounce back," he said.

The back-breaking lockdown has led international rating agencies and analysts to forecast a contraction in Indian economy in the fiscal ending March 31, 2021 and sharp recovery in the following financial year. So far, the government as well as the Reserve Bank of India (RBI) has not put an estimate of growth for 2020-21 fiscal.

Modi said the rural economy is also picking up speed. "Area under sowing of the kharif crop is 13 per cent more than last year. This year wheat production and procurement has also increased. When compared to last year, wheat procurement is 11 per cent more which means farmers are also getting more money. India has come out of past crises and it will come out of this one as well," he said.