Industry body PHDCCI 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, assessing that the worst is over and the economy is on the verge of a slow recovery.
The chamber, however, stated that unemployment remains a key challenge to be addressed by the government. The PHDCCI drew the conclusions based on its analysis of 25 high-frequency economic indicators which point out that there has been a pickup in business normalization.
However, the unemployment rate still remains a worry as it worsened to 8.3 per cent in August from 7.4 per cent in July, it said in a report.
"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," PHD Chamber of Commerce and Industry (PHDCCI) said.
It 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.
PHDCCI President Sanjay Aggarwal said 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.