New Delhi: India’s economic growth to contract by 9 percent in the current fiscal, the Asian Development Bank (ADB) predicted on Tuesday. The growth outlook remains highly vulnerable to either a prolonged outbreak of the pandemic or a resurgence of cases, it said.
“India imposed strict lockdown measures to contain the spread of the pandemic and this has had a severe impact on economic activity,” Asian Development Bank Chief Economist Yasuyuki Sawada said.
With lockdowns stalling private spending, ADB said GDP will shrink by 9 percent in April 2020 to March 2021, sharply down from its June’s forecast of (-) 4 percent.
Other downside risks include increasing public and private debt levels that could affect technology and infrastructure investment, as well as rising non-performing loans caused by the pandemic that could further weaken the financial sector and its ability to support economic growth.
#ADBNEWS: We released our latest economic forecasts for Asia and the Pacific today. Read the press release ????#ADO2020
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However, in its Asian Development Outlook (ADO) 2020 update, ADB projected a strong recovery for the Indian economy in 2021-22, with the Gross Domestic Product (GDP) growing by 8 percent as mobility and business activities resume more widely.
ADB joins a chorus of international agencies that have predicted a contraction in the Indian economy in the current fiscal.
This will be the first time in four decades that the Indian economic growth will contract.
