Mumbai : The Asian Development Bank (ADB) has projected 9% decline in the Indian economy for the current financial year 2020-21.
The Asian Development Outlook (ADO) -2020 report released by ADB on Tuesday said that the economic activity in India has been severely affected due to the corona virus. This has also impacted consumer sentiment, which will cause a 9 per cent drop in gross domestic product (GDP) in the current financial year. However, the ADB estimates that there will be a big boom in the Indian economy in the next financial year 2021-22.
According to the report released by the ADB, economic growth in Asia may fall for the first time in 60 years, the economic growth in the 45 countries of Asia-Pacific decreased by 0.7 percent, this year.
ADB said that India’s economic growth rate will be 8 percent in the next financial year due to the movement and opening of business activities. The expansion of the capacity to control, monitor, manage and treat the pandemic is important so that there is growth of the economy in the next financial year and beyond. These measures need to be implemented effectively, only then will the economy recover.
US ratings agency, S&P Global Ratings forecast a 9% decline in the Indian economy in the current financial year. Earlier, the rating agency had estimated a 5% weakness in the Indian economy. The US rating agency says that due to the Corona epidemic, private spending and investment in India can remain at a low level for a long time.
According to S&P Global Rating Economist (Asia-Pacific) Vishruta Rana, private economic activity has not picked up due to the Corona crisis. According to the rating agency, in the first quarter of the current financial year, GDP has registered a decline of 23.9%, which is more than the estimate.
Prior to this, rating agencies Moody’s and Fitch have also lowered India’s economic growth forecast. Moody’s has predicted a weakness of 11.5 per cent in the Indian economy and 10.5 per cent in the current financial year.
The rating agency has said that if the credit quality deteriorates after the end of the loan moratorium period, India’s economic recovery could be further slowed. A boom in India’s economy is possible only when the countrywide distribution of the coronavirus vaccine is ensured.