After the World Bank and Moody’s, now S&P Global Ratings on Thursday downgraded India’s growth forecast for the current financial year to 9.5 per cent from 11 percent predicted earlier. It has predicted a growth of 7.8 per cent in the financial year 2022-23.
The decline in India’s growth projection is attributed to the second wave of the COVID-19 pandemic and the uncertainty of India facing more waves of the viral infection. “Further pandemic waves are a risk to the outlook given that only about 15 per cent of the population has received at least one vaccine dose so far, although vaccine supplies are expected to ramp up,” S&P said.
Notably, several states had to impose lockdowns to control the second wave of the pandemic that wreaked havoc across the country and resulted in a massive decline in economic activity. The COVID-19 pandemic has resulted in India’s economy shrinking by 7.3 per cent in 2020-21 against a growth of 4 per cent in 2019-20.
S&P said households are running down saving buffers to support consumption and a desire to rebuild saving could hold back spending even as the economy reopens.
Before the second wave of the pandemic, several agencies including the International Monetary Fund had predicted double-digit growth for India. In fact, India was expected to top the world in terms of GDP growth. However, the second wave derailed that plan. Earlier this month, RBI too cut India’s growth forecast to 9.5 per cent for this fiscal, from 10.5 per cent estimated earlier.
COVID-19 situation in India
The Union health ministry on Thursday informed that 54,069 fresh cases of COVID-19 have been reported in India in the past 24 hours. The addition of the fresh cases has taken the COVID-19 case tally past 3 crore.
The ministry also informed that over 30.16 crore COVID-19 jabs have been administered so far. Of it, over 64.89 lakh people were vaccinated on Wednesday.
Also, 1,321 COVID-19 related deaths were reported by the ministry during this period. The addition of the fresh fatalities has taken India’s death toll due to the deadly virus to 3,91,981.
Of the over 3 crore coronavirus cases reported so far, over 6.27 lakh are active cases of the virus. It is 2.08 per cent of the total caseload. Over 2.90 crore cases have recovered from the viral infection so far.
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