Barclays sees 2020 GDP degrowth at 4%, pegs lockdown cost at $306 billion
With over 190,000 confirmed cases as on May 31, India has the world's 7th highest number of recorded coronavirus infections. However, more than 48 per cent infected people have recovered fully with death rate of less than 3 per cent among confirmed COVID-19 cases
- Jun 1, 2020,
- Updated Jun 1, 2020 4:36 PM IST
Negative economic growth is certain in the ongoing financial year. The Reserve Bank of India has already said that country's GDP growth could be in negative territory in 2020-21. While the central bank didn't give an estimate to it, global investment bank Barclays sees 4 per cent GDP degrowth in calendar year 2020 and 3.2 per cent in FY21.
Revising its forecast for the June quarter, the brokerage estimates Q1FY21 growth to contract by 22.2 per cent year-on-year compared to 12.4 per cent earlier.
"We now assume that partial movement controls will remain in place across key economic states for 10 weeks beyond the scheduled end of phase-four of the lockdown, that is until mid-August. We estimate this additional period will see incremental economic losses of $71.5 billion, bringing the total cost of the lockdown to an estimated $306 billion (11.5 per cent of GDP)," says Barclays in a note.
With over 190,000 confirmed cases as on May 31, India has the world's 7th highest number of recorded coronavirus infections. However, more than 48 per cent infected people have recovered fully with death rate of less than 3 per cent among confirmed COVID-19 cases.
Negative economic growth is certain in the ongoing financial year. The Reserve Bank of India has already said that country's GDP growth could be in negative territory in 2020-21. While the central bank didn't give an estimate to it, global investment bank Barclays sees 4 per cent GDP degrowth in calendar year 2020 and 3.2 per cent in FY21.
Revising its forecast for the June quarter, the brokerage estimates Q1FY21 growth to contract by 22.2 per cent year-on-year compared to 12.4 per cent earlier.
"We now assume that partial movement controls will remain in place across key economic states for 10 weeks beyond the scheduled end of phase-four of the lockdown, that is until mid-August. We estimate this additional period will see incremental economic losses of $71.5 billion, bringing the total cost of the lockdown to an estimated $306 billion (11.5 per cent of GDP)," says Barclays in a note.
With over 190,000 confirmed cases as on May 31, India has the world's 7th highest number of recorded coronavirus infections. However, more than 48 per cent infected people have recovered fully with death rate of less than 3 per cent among confirmed COVID-19 cases.