As per the World Bank, South Asia Economic Focus report of October 2020, there would be a massive dip in India’s Gross Domestic Product (GDP) in this Fiscal Year (FY2020-2021). It states that India’s GDP would drop to 9.6 per cent, which is significantly lower than June’s forecast of 3.2 per cent made by the World Bank during the nation-wide lockdown that was enforced due to the Covid-19 pandemic. Our country faced a 25% drop in the GDP during the first quarter of the current fiscal year.
The World Bank said that in India, after fiscal 2017, during which the economy grew at 8.3 per cent, growth slowed down in each subsequent years to 7.0 per cent in 2018, 6.1 per cent in FY2019 and 4.2 per cent in 2020 because of the emerging weaknesses in non-bank financial companies and slowing private consumption growth
The report also states that the regional growth would decline by 7.7 per cent and the global economy itself, by 5.2 per cent. Considering the population growth, the regional income-per-capita is said to remain 6 per cent below the year 2019 estimates.
Many industries in India, including the manufacturing and export industries and the construction sector, would be impacted due to the limitations caused due to the lockdown, as per the report.
Indian economy is expected to recover between 4.5 per cent and 5.4 per cent in FY22, based on the assumption that the restrictions enforced due to pandemic would be lifted by then.
Sources: hindustan time