Key Points:
- 6% recession is expected by the World Bank of the Indian Economy.
- “Condition in India is worse than before,” Hans Timmer, World Bank for South Asia Chief.
- The close down of the businesses and transport and tourism has let to the downfall of the economy.
- India’s efforts to curb the virus were appreciated on the conference call.
On Thursday, The World Bank said that India’s GDP is expected to contract by 9.6 per cent this fiscal. This comes as a result of the National Lockdown and the deteriorated incomes that the households and firms have had due to the ongoing Covid-19 pandemic. The World Bank mentioned that the country’s economic situation is “much worse” than ever seen before.
A steeper than anticipated economic collapse across the South Asian region along with regional growth expected to contract by 7.7% in 2020, after topping 6% annually in the past five years forecasted the Washington-based global lender, in its latest South Asia Economic Focus report ahead of the annual meeting of the World Bank and International Monetary Fund.
“India’s GDP is expected to contract by 9.6 per cent in the fiscal year that started in March,” the World Bank said in the report released here.
4.5 per cent in 2021 is the expected Regional growth to rebound said the report.
The World Bank’s Chief Economist for the South Asian branch, Hans Timmer, on a conference call said,
“The situation is much worse in India than we have ever seen before.”
Saying that the situation in India is exceptional he also added that the outlook is even more awful.
There was a 25 per cent decline in GDP in the second quarter of the year, which is the first quarter of the current fiscal year in India.
Due to the spread of the pandemic and its containment measures, supply and demand conditions have been hit hard in India which may lead to a drastic economic fall, mentioned the report.
Despite of the outbreak of the virus in the country, India’s response was quite swift and comprehensive, said the World Bank report. India’s lockdown was said to be the World’s Biggest lockdown when 135 crore Indians were asked to lock themselves down at their homes which led to closure of majority factories and businesses, suspended flights, stopped trains and restricted vehicle and people’s movements. This led to the figures change.
