Ray Of Hope! Fitch Ratings Puts India's GDP Growth To 0.8% But It'll Rebound To 6.7% In 2021-22

The coronavirus pandemic is no doubt to have huge economic implications, and now Fitch Ratings has slashed India¡¯s economic growth projections to 0.8 per cent in the current 2020-21 fiscal.

Agencies

Citing that unparalleled global recession was underway due to disruptions caused by the outbreak of coronavirus pandemic and resultant lockdowns, the American credit agency has predicted a troublesome year for Indian economy.

In its Global Economic Outlook, Fitch Ratings said India¡¯s gross domestic product (GDP) growth will slip to 0.8 per cent for the year April 2020 to March 2021 (FY21) as compared to an estimated 4.9 per cent growth in the previous fiscal.

Growth is, however, expected to rebound to 6.7 per cent in 2021-22.

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The rating agency predicted two consecutive quarters of contraction or negative year-on-year growth in current fiscal - (-)0.2 per cent in April-June and (-)0.1 per cent in July-September. This compares to 4.4 per cent estimated growth in January-March.

Fitch Ratings also in its report says that it expects world GDP to contract by 3.9% in 2020, a recession of unprecedented depth in the post-war period. This is twice as large as the decline anticipated in its early April update and would be twice as severe as the 2009 recession.

The coronavirus pandemic has hit the world economy with businesses shut in majority of the countries worldwide and unemployment soaring.

Reuters

From India to Italy, coronavirus lockdowns have closed businesses and kept billions of people homebound for weeks, provoking a simultaneous supply and demand shock that¡¯s snarled global production and logistics networks built without sufficient capacity to absorb a jolt of this magnitude.

In United States alone, more than 25 million people have filed for unemployment benefits and President Donald Trump has ordered an executive order to ban immigrants for now, as country faces mounting economic hurdles.