India’s economy to struggle with effects of virus through 2025
India will be worst-affected among the world’s major economies even after the pandemic wanes, with output 12% below pre-virus levels through the middle of the decade, according to Oxford Economics.
Balance sheet stress that had been building before the coronavirus outbreak will probably worsen, Priyanka Kishore, head of economics for South Asia and South-East Asia, wrote in the report. She projects potential growth for India at 4.5% over the next five years, lower than 6.5% before the virus.
“It’s likely that headwinds already hampering growth prior to 2020 -- such as stressed corporate balance sheets, elevated non-performing assets of banks, the fallout in non-bank financial companies, and labor market weakness -– will worsen,” she said. “The resulting long-term scars, probably among the worst globally, would push India’s trend growth substantially lower from pre-Covid levels.”
The contraction hasn’t deterred PM Narendra Modi from reiterating his target of making India a $5 trillion economy by 2025 from $2.8 trillion. While the go nment has announced a slew of measures to support growth, they have fallen well short of expectations to boost demand, leaving the central bank to do much of the heavy-lifting. A paper published by the Reserve Bank of India last week predicted Asia’s third-largest economy has entered a historic technical recession. Official data is due November 27.
The International Monetary Fund (IMF) predicts GDP will shrink 10.3% in the year to March 2021 as Modi’s sudden lockdown paralyzed activity. While a sharp rebound is forecast as economic activity resumes, there are lingering scars.
With Planning & Perseverance India will recover sooner than expected.
Modi sarkar will definitely achieve Minus -5 trillion economy.
Covid-19 hitting India most because PM Modi failed to address the nation to do what is necessary at the time of this natural calamity from God as all efforts failed for the vaccine.
Every thing is possible including 5 trillion dollar economy, since we have huge all time high dollar reserve and citizens are able to pay what ever taxes demanded by govt on petrol and diesel. Every thing is possible by squeezing tax payers and middle class.
not sure y ppl r so pessimistic about India. every country is going thru recession (barring china) n the balance sheets of countries like france n italy r way worse than ours w/130% n 160% debt to gdp.
Laxmi gone bankrupt on Diwali, forced to marry a foreigner!
Modi Sarkar is not going to achieve $ 5 trillion GDP by 2025 with their own stupid policies. That's writing on the wall.
Hari Krishna Johri
Feku is happy to make catchy slogans for public consumption as he doesn't appear to be serious to implement.
It is not the pandemic that is slowing down our growth but our inability to remain honest and work for our progress.
The economic foundations of India built over 74 years since Independence has not been built on solid grounds. Over a billion Indians on a ship that has huge holes with water flooding into its holds will sink fast.
Three banks gone to the cleaners, in six years of Mr Modis great governance. PMC, YES, LVB. At this rate it is anybody's guess how many more in pipeline. But still he fools around with his 5 trillion bluff, and we Indians are lapping it up.
India will definately shine.Indian economy will certainly rebound.
The article is exposing modi for being only election minded all the six years from 2014. What he did was to take total control of the judiciary, administration, media, killing de acy in the process, forgetting that it was de acy that was responsible for his election in 2014.
This article is 4 months late
We are 1.4 billion people country and no oxford or some Mr iyer or some Andy Mukherjee or some goldman sachs can guess what will be the future of 1.3 billion people .everybody is way off