Q3 GDP numbers: Private sector investments will pick up soon, say experts

Investments grew after a gap of three quarters, driven by the government, while demand contracted for the third consecutive quarter during October-December (Q3) of financial year 2020-21 (FY21). 

Even then, investments remained subdued, growing by a marginal 2.56 per cent in Q3FY21. It had started declining even before the pandemic started impacting India’s economy.

Gross fixed capital formation (GFCF) contracted by 6.48 per cent in Q4FY20. It plunged in Q1FY21 before returning to earlier levels in Q2.

Madan Sabnavis, chief economist at CARE Ratings, said investments in Q3 were driven purely by the government. This is backed up by the data from the