The Asian Development Bank has downgraded India’s economic growth forecast for the current financial year to 10 % from 11% that it had previously projected in the month of April. This downgrade was done taking into account the adverse impact of the second wave of the Coronavirus pandemic.
Highlights
- In the last quarter of fiscal year which ended in March 2021, India’s GDP growth recovered to 1.6%.
- A second wave of the pandemic induced many state governments to impose strict containment measures hence, the growth projection for FY2021-2, was downgraded to 10% from the previously predicted 11%.
- The projection for FY2022-23 is upgraded to 7.5% from 7% as most of the population will be vaccinated by that time and economic activity will normalise.
Economic projection for China and South Asia
- Expansion in China is still projected at 8.1% in 2021, and 5.5% in 2022.
- Regarding South Asia, ADB said that the economic outlook for this sub region is being hit by the new waves of COVID-19 from the months of March to June 2021.
- The GDP growth forecast for the South Asian region has been downgraded from 9.5% to 8.9 % for the year 2021-22.
- For the year 2022, forecast has been upgraded from 6.6% to 7%.
Projection for Developing Asia
In developing Asia, recovery is underway but the growth projection for this year has been revised down to 7.2% from 7.3% predicted in the Asian Development Outlook 2021 in the month of April. This downgrade was done due to the recent virus outbreaks in some economies of this region. The projection for developing Asia for the year 2022 has been upgraded to 5.4% from 5.3%.