New Delhi: Asian Development Bank (ADB) has downgraded India Economic Development The forecast for the current fiscal was 10 per cent on Tuesday, up from 11 per cent estimated earlier this year, mainly due to the adverse impact of the coronavirus pandemic.
India’s GDP growth reached 1.6 per cent in the last quarter of the fiscal year ended March 2021, a revision of the contraction for the full fiscal year to 7.3 per cent from 8 per cent projected in April, the multilateral funding agency said Asian Development Outlook (ADO) Supplement.
“Then a second wave of the pandemic prompted many state governments to implement strict containment measures. New Covid-19 cases rose to over 400,000 daily in early May, then a little over 40,000 in early July. Have become.
“Early indicators show economic activity has resumed following the easing of containment measures. Growth projections for fiscal year 2021 (ending March 2022), ADO reduced from 11 per cent in 2021 to 10 per cent, taking into account large base impacts. it shows.” ADO was released in April.
Meanwhile, this year’s inflation forecast for Asia and the Pacific has been raised to 2.4 per cent from 2.3 per cent in April, reflecting a rise in oil and commodity prices. The estimate for 2022 remains at 2.7 percent.
For South Asia, the inflation forecast has been raised from 5.5 per cent to 5.8 per cent for 2021, reflecting a higher forecast mainly for India. However, it has been kept unchanged at 5.1 per cent for 2022.
Indian consumer price inflation rose to 6.3 per cent year-on-year in May as both food and fuel inflation surpassed expectations.
“This supplement raises the inflation forecast for India by 0.3 percentage points to 5.5 percent for fiscal year 2021 (the fiscal year ending March 2022), while keeping the fiscal year 2022 forecast at 4.8 percent,” ADB said. ”
Meanwhile, the Manila-headquartered funding agency said growth projections for fiscal year 2022 (ending March 2023), by which time most of India’s population is expected to be vaccinated, will range from 7 per cent to 7.5 per cent once economic activity returns to normal. has been upgraded.
With respect to China, the ADB supplement said expansion in the People’s Republic of China is still projected to be 8.1 percent in 2021 and 5.5 percent in 2022, as favorable domestic and external trends are in line with forecasts for April.
On South Asia, ADB stated that the economic outlook for the sub-region has weakened from new waves of COVID-19 in the sub-region from March to June 2021.
The adverse economic impact of these new waves is expected to be limited, with businesses and consumers now able to better adapt to pandemic and containment measures than a year ago, it said.
ADB said in the supplement, “The GDP growth forecast for the sub-sector in 2021 has been reduced from 9.5 percent in ADO 2021 to 8.9 percent, but from 6.6 percent for 2022 to 7 percent.” has been upgraded.”
The COVID-19 pandemic remains the biggest risk to the outlook, as the outbreak continues to wreak havoc in many economies. The daily confirmed cases in the region reached around 4,34,000 in mid-May. They narrowed down to about 1,09,000 at the end of June, ADB said, mainly concentrated in South Asia, Southeast Asia and the Pacific.
Meanwhile, the vaccine rollout in the region is gaining momentum, with 41.6 doses administered per 100 people as of the end of June – above the global average of 39.2, but below the rate of 97.6 in the United States and 81.8 in the European Union.
ADB lowers growth projections for South Asia, Southeast Asia and the Pacific for 2021, saying: “Renewed outbreaks are met with containment measures and restrictions, disrupting economic activity “.
“Asia and the Pacific continue to recover from the COVID-19 pandemic, although the path remains uncertain amid new outbreaks, new virus variants and uneven vaccine rollouts,” said ADB chief economist Yasuyuki Sawada.
“On top of prevention and vaccination measures, a phased and strategic rejuvenation of economic activity – for example, trade, manufacturing and tourism – will be key to ensuring that the recovery is green, inclusive and resilient,” Sawada said.
ADB said that even if the pandemic persists, developing Asia is widely projected to maintain its strong rebound in line with ADO’s April forecasts.
Recovery is underway in developing Asia, but growth projections for this year fell slightly to 7.2 per cent in April from 7.3 per cent in the Asian Growth Outlook 2021, following renewed virus outbreaks in some economies.
It said that the projection (developing Asia) for 2022 has been increased from 5.3 percent to 5.4 percent.
‘Developing Asia’ refers to a group of more than 40 countries that are members of ADB.
India’s GDP growth reached 1.6 per cent in the last quarter of the fiscal year ended March 2021, a revision of the contraction for the full fiscal year to 7.3 per cent from 8 per cent projected in April, the multilateral funding agency said Asian Development Outlook (ADO) Supplement.
“Then a second wave of the pandemic prompted many state governments to implement strict containment measures. New Covid-19 cases rose to over 400,000 daily in early May, then a little over 40,000 in early July. Have become.
“Early indicators show economic activity has resumed following the easing of containment measures. Growth projections for fiscal year 2021 (ending March 2022), ADO reduced from 11 per cent in 2021 to 10 per cent, taking into account large base impacts. it shows.” ADO was released in April.
Meanwhile, this year’s inflation forecast for Asia and the Pacific has been raised to 2.4 per cent from 2.3 per cent in April, reflecting a rise in oil and commodity prices. The estimate for 2022 remains at 2.7 percent.
For South Asia, the inflation forecast has been raised from 5.5 per cent to 5.8 per cent for 2021, reflecting a higher forecast mainly for India. However, it has been kept unchanged at 5.1 per cent for 2022.
Indian consumer price inflation rose to 6.3 per cent year-on-year in May as both food and fuel inflation surpassed expectations.
“This supplement raises the inflation forecast for India by 0.3 percentage points to 5.5 percent for fiscal year 2021 (the fiscal year ending March 2022), while keeping the fiscal year 2022 forecast at 4.8 percent,” ADB said. ”
Meanwhile, the Manila-headquartered funding agency said growth projections for fiscal year 2022 (ending March 2023), by which time most of India’s population is expected to be vaccinated, will range from 7 per cent to 7.5 per cent once economic activity returns to normal. has been upgraded.
With respect to China, the ADB supplement said expansion in the People’s Republic of China is still projected to be 8.1 percent in 2021 and 5.5 percent in 2022, as favorable domestic and external trends are in line with forecasts for April.
On South Asia, ADB stated that the economic outlook for the sub-region has weakened from new waves of COVID-19 in the sub-region from March to June 2021.
The adverse economic impact of these new waves is expected to be limited, with businesses and consumers now able to better adapt to pandemic and containment measures than a year ago, it said.
ADB said in the supplement, “The GDP growth forecast for the sub-sector in 2021 has been reduced from 9.5 percent in ADO 2021 to 8.9 percent, but from 6.6 percent for 2022 to 7 percent.” has been upgraded.”
The COVID-19 pandemic remains the biggest risk to the outlook, as the outbreak continues to wreak havoc in many economies. The daily confirmed cases in the region reached around 4,34,000 in mid-May. They narrowed down to about 1,09,000 at the end of June, ADB said, mainly concentrated in South Asia, Southeast Asia and the Pacific.
Meanwhile, the vaccine rollout in the region is gaining momentum, with 41.6 doses administered per 100 people as of the end of June – above the global average of 39.2, but below the rate of 97.6 in the United States and 81.8 in the European Union.
ADB lowers growth projections for South Asia, Southeast Asia and the Pacific for 2021, saying: “Renewed outbreaks are met with containment measures and restrictions, disrupting economic activity “.
“Asia and the Pacific continue to recover from the COVID-19 pandemic, although the path remains uncertain amid new outbreaks, new virus variants and uneven vaccine rollouts,” said ADB chief economist Yasuyuki Sawada.
“On top of prevention and vaccination measures, a phased and strategic rejuvenation of economic activity – for example, trade, manufacturing and tourism – will be key to ensuring that the recovery is green, inclusive and resilient,” Sawada said.
ADB said that even if the pandemic persists, developing Asia is widely projected to maintain its strong rebound in line with ADO’s April forecasts.
Recovery is underway in developing Asia, but growth projections for this year fell slightly to 7.2 per cent in April from 7.3 per cent in the Asian Growth Outlook 2021, following renewed virus outbreaks in some economies.
It said that the projection (developing Asia) for 2022 has been increased from 5.3 percent to 5.4 percent.
‘Developing Asia’ refers to a group of more than 40 countries that are members of ADB.
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