The World Bank has estimated India’s GDP growth in the broad range of 7.5 to 12.5 per cent for the financial year 2021-22 amid uncertainty caused by the COVID-19 pandemic.
“Given the significant uncertainty pertaining to both epidemiological and policy developments, real GDP (Gross Domestic Product) growth for FY21/22 can range from 7.5 to 12.5 percent, depending on how the ongoing vaccination campaign proceeds, whether new restrictions to mobility are required, and how quickly the world economy recovers,” the World Bank said in a report titled “South Asia Vaccinates”.
Going forward, the report said, “the main risks to the outlook include the materialisation of financial sector risks, that could compromise a recovery in private investment, and new waves of Covid-19 infections.”
“In response to the Covid-19 outbreak, the authorities implemented a nationwide lockdown, which brought economic activity to a near standstill between April and June 2020 (Q1FY21),” the report said. Aviation and tourism, hospitality, trade, and construction, were the worst hit as well and industrial activity, overall, was also deeply disrupted. Agriculture, however, was mostly unaffected, it noted.
Acknowledging it is “not normal” to cite growth forecast in a range of numbers, World Bank’s Chief Economist for South Asia, Hans Timmer, told reporters, “We are really in an unprecedented circumstance. Not just the hits (were) unprecedented, but also the character of the crisis was as we had never seen before.”