Citing reasons such as Coronavirus pandemic and the lockdown to curb its spread, India Ratings and Research (Ind - Ra) on Monday (27 April) revised its forecast for India’s economic growth in FY21 down to 1.9 per cent.
If the predicted figure turns out to be true, it will be the lowest GDP growth for India in 29 years. According to the ratings agency, Indian economy grew only 1.1 per cent in FY 1991-92.
Earlier on 30 March, Ind - Ra had given a forecast of 3.6 per cent growth rate for India’s economy in FY21, which the agency wrote it down to 1.9 per cent in a note released on Monday.
The agency also stated that it’s forecast was based on the assumption that the lockdown will only continue until mid-May 2020.
“GDP may come back to the fourth quarter of 2019-20 fiscal level only by the third quarter (October-December) of current 2020-21 fiscal anticipating resumption of normal economic activities during second quarter (July-September) of 2020-21 and festive demand during third quarter of current fiscal (October-December),” Ind - Ra said.
The agency further added that if the lockdown continued beyond the above given period and the gradual recovery begins only from June-end, the GDP growth rate may be 2.1 per cent in negative. If that happened it would be the lowest GDP growth rate in 41 years and only the fourth instance since FY1957-58, it said.
As you are no doubt aware, Swarajya is a media product that is directly dependent on support from its readers in the form of subscriptions. We do not have the muscle and backing of a large media conglomerate nor are we playing for the large advertisement sweep-stake.
Our business model is you and your subscription. And in challenging times like these, we need your support now more than ever.
We deliver over 10 - 15 high quality articles with expert insights and views. From 7AM in the morning to 10PM late night we operate to ensure you, the reader, get to see what is just right.
Becoming a Patron or a subscriber for as little as Rs 1200/year is the best way you can support our efforts.