Top

COVID: What will happen to country's economic advancement & Effect on GDP!

With the news of vaccination in India for people above 18, begins from 1st may, there are concerned about the economy.

Ankit Awasthi

Ankit AwasthiBy Ankit Awasthi

Published on 22 April 2021 9:32 AM GMT

COVID: What will happen to countrys economic advancement & Effect on GDP!
X
PC: Social Media
  • Facebook
  • Twitter
  • Whatsapp
  • Telegram
  • Linkedin
  • Print
  • Facebook
  • Twitter
  • Whatsapp
  • Telegram
  • Linkedin
  • Print
  • Facebook
  • Twitter
  • Whatsapp
  • Telegram
  • Linkedin
  • Print

New Delhi: With the news of vaccination in India for people above 18, begins from 1st may, there are concerned about the economy and its ups and down, second wave of Spanish Flu also have this kind of second wave.

Index Genius Investment Advisor's CTA Amit Harchekar said that rupee shall go at a low of 80.40 as it is crossed 73.85 mark.

More than 2 lakh cases daily:

Now more than 2.5 lakh cases of Corona infection in the country are coming daily. In such a situation, many states have announced to put lockdown. In such a situation, economic activities have slowed down. Therefore, there has been an concern about economic growth in the country. Many big rating agencies have decreased the goal of India's economic growth. Let's learn the whole case ... India's economic growth target decreased Japan's well-known international agency Nomura has reduced the estimation of the country's economic GDP growth rate for the current financial year to 12.6 percent.

In addition, US rating agency JP Morgan has cut India's economic growth by 2 per cent. The target for economic growth has been reduced from 13 per cent to 11 per cent.

Economic growth in FY2016-17 was 8.3 per cent which declined to 6.8 per cent and 6.5 per cent respectively in the next two years 2017-18 and 2018-19. In 2019-20, it dropped to 4 per cent

The covid-19 pandemic-hit fiscal 2020-21 has projected an economic growth rate decline of up to 8 per cent.

Due to weak comparative base in the last financial year, the growth rate in the current financial year is expected to be in the tenth digit and 6.8 per cent in the next financial year 2022-23.

The Reserve Bank of India has projected GDP growth of 10.5 per cent in FY 2021-22 while the IMF has projected 12.5 per cent. Corona cases have been rising rapidly in the past two weeks.

What if lockdown is imposed?

Bank of America Securities says corona may reduce the speed of economic recovery rather. GDP could fall by 2 per cent if there is a month-wide nationwide lockdown.

Fitch has also said that India's economy was returning to the normal path after overcoming the Corona virus to some extent. "However, the virus has been spreading rapidly in recent weeks. In India, the immunization campaign is lagging behind per capita."

UBS has reduced GDP growth forecast from 11.5 per cent to 10 per cent. U.S. Bank City has reduced the economic growth target to 12 per cent. India's GDP growth rate was declining before the early last year's pandemic.

UBS raised real GDP estimates for FY 2021-22 to 10 per cent (11.5 per cent earlier) on an annual basis, saying if the virus is controlled in the coming week, recovery will pick up from the second quarter of FY2021-22.

City Research said that while restrictions are not that strict compared to last year, the rapid rise in the Covid case is a cause for concern. City said several revisions could be made to economic growth forecasts like last year if covid's situation is not brought under control.

Maharashtra-Gujarat and Delhi raise concerns as cases rise:

In terms of infection, states like Maharashtra, Gujarat and Delhi are coming up more than those which are economically important states. Credit Suisse said that In September 2020, covid had the highest number of cases, now more than double that. He said that this time it is not the same as the strict "lockdown" that was imposed last year. 'Lockdown' is likely to remain the same locally and remain less stringent than last year.




Ankit Awasthi

Ankit Awasthi

Next Story