GDP to contract by 9% in FY 21: Crisil


Mumbai, September 10

The Indian economic system will contract by 9% in 2020-21 because the coronavirus infections are but to peak and the federal government just isn’t offering sufficient direct fiscal help, rankings company Crisil stated on Thursday.

Revised forecast

  • In May, Crisil had estimated the economic system to contract by 5%. The newest projection comes days after official information for the June quarter confirmed a contraction of 23.9% within the economic system
  • Crisil stated the 9% contraction would be the highest for the reason that 1950s
  • It expects a everlasting lack of 13% of actual GDP over the medium time period, pegging its worth in nominal phrases at Rs30 lakh crore

In May, Crisil had estimated the economic system to contract by 5%. The newest projection comes days after official information for the June quarter confirmed a contraction of 23.9% within the economic system. Crisil stated the 9% contraction would be the highest for the reason that 1950s.

The authorities had introduced a Rs 20 lakh-crore reduction bundle however the precise new spending was lower than 2% of GDP.

“With the pandemic’s peak not yet in sight and the government not providing adequate direct fiscal support, the downside risks to our earlier forecast have materialised,” the company stated.

“A stretched fiscal position has constrained the government from spending more to support the economy. Till date, the policy push to growth remains muted, except in pockets. Our May forecast had assumed additional direct fiscal support of 1% of GDP, which has not come through,” the company stated. — PTI



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