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The Asian Development Bank has predicted the forecast for India’s economic growth to 10% for the current fiscal year. It had earlier predicted a growth of 11%. The revised forecast showed a 1% decline due to the ill effects of the second wave of the Covid-19 pandemic. ADB stated that due to the slow pace of economic recovery caused by rising Covid-19 cases during the month of May, the growth forecast for the fiscal year 2021 (ending in March 2022) was revised down.
The Asian Development Outlook Update (ADOU) 2021, “The economy is expected to rebound strongly in the remaining three quarters of FY2021, and grow by 10% in the full fiscal year before moderating to 7.5% in FY2022.”
With declining Covid-19 cases in India, faster than it was expected, many states have eased lockdown restrictions and gone back to pre-Covid travel patterns.
In April forecast this year, ADB had projected India to grow at 11% in the current fiscal year.
On India’s growth, the multilateral funding agency said, “Because consumption will recover only gradually, government spending and exports will contribute more to FY2021’s growth than they did in the previous fiscal year.”
The economic outlook differs across South Asia, which includes Afghanistan, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan, and Sri Lanka. The region is anticipated to expand faster than next year and slower than the previous year.
People’s Republic of China (PRC) will remain strong, despite a protracted recovery in household consumption.
“The GDP growth forecast remains unchanged at 8.1% in 2021 and 5.5% in 2022, as a solid export performance and higher fiscal support in the second half of 2021 keep growth on track,” it said on China.