The World Bank in its latest Global Economic Prospect downgraded its projection of growth of India by -9%. However, the World Bank believes that Indian growth is to bounce back in 2021.
Highlights
The World Bank says that the growth of India has slowed by 4.2% in 2019-20. The other international rating agencies such as Fitch ratings, Moody’s Investor Service, S&P Global Ratings have all predicted India’s growth rate as 4% to 5% in the year 2020-21. According to Crisil, this is India’s fourth economic recession since independence.
Key Findings of the report
The Key findings of the report about India are as follows
- The report says that the Government of India has been purchasing government bonds to ease financial conditions
- The Indian Government has increased its spending to contain COVID-19. This has been done through
- Wage support
- Deferral in tax payments
- Cash transfer to lower-income households
- Loan and liquidity support to small businesses and financial institutions.
- The contraction of Indian Economy will find its impact in South Asian region
South Asia
The report says that in the South Asian region, Pakistan and Afghanistan are to experience contractions in the year 2020. Bangladesh is expected to grow at 1.6% and Nepal is expected to grow at 1.8%
India is the fifth worst hit nations in the world after USA, Brazil, Russia and UK.