New Delhi: The Asian Development Bank (ADB) on Tuesday projected a 9 per cent decline in India’s gross domestic product (GDP) in the current financial year, saying that the Corona virus pandemic has had a very serious impact on Indian economic activity and consumer perception.
However, according to the report released by the ADB, with the acceleration in mobility and business activities in 2021, the economy will improve sharply and the Indian economy will grow at 8 per cent in 2021-22.
Economies across developing Asia will contract this year for the first time in nearly six decades but recovery will resume next year, as the region starts to emerge from the economic devastation caused by the coronavirus disease (COVID-19) pandemic,’ the report said.
A prolonged COVID-19 pandemic remains the biggest downside risk to the region’s growth outlook this year and next year.
To mitigate the risk, governments in the region have delivered wide-ranging policy responses, including policy support packages—mainly income support—amounting to USD 3.6 trillion, equivalent to about 15 per cent of regional GDP.
Other downside risks arise from geopolitical tensions, including an escalation of the trade and technology conflict between the United States and the People’s Republic of China (PRC), as well as financial vulnerabilities that could be exacerbated by a prolonged pandemic.
Subregions of developing Asia are expected to post negative growth this year, except East Asia which is forecast to expand by 1.3 per cent and recover strongly to 7.0 per cent in 2021