CRISIL cuts India’s GDP forecast to 9.5% from 11%

Ratings agency, CRISIL, has cut India’s gross domestic product (GDP) growth forecast from 11 percent to 9.5 percent for fiscal year 2021-2022.

Highlights

  • Downward forecast reflects that second covid-19 has hit two engines of growth private consumption and investment.
  • It has thrown Indian economy to most severe contraction since Independence.

Pinpricked Growth report

  • As per “Pinpricked growth report” by CRISIL, rash of afflictions forced states to lock down which hurt consumer & business confidence again in 2021.
  • Report mentioned about third wave & tardy vaccinations and highlighted that; states would be careful of fully unlocking anytime soon. This in turn affect the economy.
  • According to it, Covid-19 restrictions will continue and mobility will be affected in some form or other till August 2021.
  • Report highlighted the significance of vaccination in economic recovery. Economic recovery will be a function of pace of vaccination in coming months.

Other Reports on Growth

Medical scientists projected; India could be hit by third Covid-19 wave which have significant downside risk to the growth. It forecasted GDP growth to be around 8 per cent. Similarly, Reserve Bank of India has downgraded GDP projection from 10.5 per cent to 9.5 per cent in 2021-22.

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