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India's GDP is likely to contract by 8 per cent in the current financial year, according to the FICCI's Economic Outlook Survey.

In a statement, FICCI said that the median growth forecast for agriculture and allied activities has been put at 3.5 per cent for 2020-21.

"Agriculture sector has exhibited significant resilience in the face of the pandemic. Higher rabi acreage, good monsoons, higher reservoir levels and strong growth in tractor sales indicate continued buoyancy in the sector," it said.

However, industry and services sector, which were most severely hit due to the pandemic induced economic fallout, are expected to contract by 10.0 per cent and 9.2 per cent respectively during 2020-21.

The FICCI survey noted that the industrial recovery is gaining traction, but the growth is still not broad based. The consumption activity did spur during the festive season as a result of pent-up demand built during the lockdown but sustaining it is important going ahead, it added.

Also, some of the contact intensive service sectors like tourism, hospitality, entertainment, education, and health sector are yet to see normalcy.

The quarterly median forecasts indicate GDP growth to contract by 1.3 per cent in the third quarter of 2020-21. The growth is expected to be in the positive terrain by the fourth quarter with a projection of 0.5 per cent growth.

The present round of FICCI's Economic Outlook Survey was conducted this month and drew responses from leading economists representing industry, banking and financial services sector.

The survey found that GDP growth in the next fiscal is expected to be around 9.6 per cent.

"The strong rebound in growth will be supported by a favorable base as economic activity normalises post the sharp pandemic led contraction. The minimum and maximum growth estimate was forecast at 7.5 per cent and 12.5 per cent respectively," it said.

However, a surge in the number of Covid-19 cases and the appearance of new strains can be a deterrent to the improving growth conditions.

"It is therefore important that preventive measures continue to be in place. A good vaccine coverage without many cases of adverse reporting will be a pre-requisite for the normalisation process."