Drive a Covid-19 vaccination at a government health center during a Covid-19 emergency in Kolkata, India, on May 3, 2021.
Indranil Aditya | Na Photo | Getty Images
India’s economy is expected to improve in the three months ending in March, but analysts have lowered its growth forecast for the quarter ending in June.
This happens as India continues to fight the second wave of the devastating coronavirus epidemic.
Gross domestic product for the January-March period (India’s fourth quarter of accounting) is scheduled around noon (GMT) on Monday. The Indian fiscal year begins in April and ends in March of the following year.
According to Reuters, the median growth rate for the March quarter was 1%, up from 0.4% in the previous quarter, according to economists surveyed. However, economists are not very optimistic about the current quarter ending in June.
The median growth forecast for the three months from April to June was 21.6%, down from the previous forecast of 23%, Reuters reported. The median forecast for fiscal year 2022 is down 9.8% from the previous forecast of 10.4% growth.
India is the second most infected country in the world after the United States. More than 28 million cases and more than 329,000 deaths have been reported.
Mizuho Bank economist Lavanya Benkateswaran said in a note on Monday: “The re-emergence of the new coronavirus has flooded another wave of activity, giving India a chilling comfort to its expected growth in the March quarter. Would be. “
Venkateswaran explained that the real focus is on how India will get the economy on track later in the calendar year after the expected recession in the current quarter.
She added that the greater concern was the impact of the country’s informal economy and the scars on the banking sector, which is already suffering from capital-limited and poorly performing assets.
Covid-19 cases in India began to increase in February, with daily infection rates accelerating and peaking in April and May. On May 7, there were more than 414,000 cases. The second wave forced most industrial states in India to implement local blockades to delay the spread of the virus.
Cases have reached record highs, Daily reports are below 200,000, Concerned about rapid communication In rural India, experts Medical infrastructure is not equipped to handle the surge in patients..
India strengthened its Covid-19 vaccine program later this year Economists say they will minimize the impact of the potential third wave of infection.
“Ultimately, we’ll end up with vaccination,” HSBC’s co-head of Asian economic research, Frederick Neumann, told CNBC.Squawbox Asiaon Monday. “In order to stabilize the epidemic, we need to reach important immunization levels in India, which is important for economic growth.”
Based on trends seen last year, Newman added that the Indian economy tends to recover rapidly as virus cases peak, he said, and the situation will improve by the end of the September quarter. He said he was expecting that.
Aggressive vaccination efforts pose risks associated with a potential downgrade of India’s sovereign rating, which is a concern among investors, according to Deutsche Bank’s Chief Economist for India and South Asia, Kausik Das. Can be mitigated.
Rating agency They said No imminent change seen India’s sovereign rating is not yet available.They have the economic impact of the second wave June quarterly only And we predict it will not be as serious as last year, when India implemented a nationwide blockade for several months.
Expected to grow 1% year-on-year
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