Second wave casts doubt over India's double digit GDP growth

S&P Global Ratings on Wednesday cut India's GDP growth forecast to 9.8 per cent for financial year 2021-22 from 11 per cent earlier due to the second wave of COVID-19 pandemic which is likely to derail the "promising" recovery in the economy.

As the second wave of Covid-19 engulfs India, economists at IHS Markit have estimated India's economic growth during FY22 at 9.6 per cent -- a revision of 0.8 per cent from their earlier estimates. They expect pain in the economy to grow given the recent measures to curb the pandemic. Economists further cautioned that with more states likely to follow suit, their growth projection faces risk of a further downgrade.

UBS has downgraded India's economic growth estimate to 10 per cent from 11.5% earlier as the second wave of COVID-19 pandemic takes a toll on India's economy.

With a downward revision of 0.3 per cent India Ratings and Research has changed India's GDP forecast to 10.3% citing the second wave of Covid-19 infections and slowing speed of vaccination drive.

Barclays Securities has lowered India's 2021-22 GDP growth forecast to 10 per cent year-on-year from 11 per cent earlier due to ravaging second wave of coronavirus. In a research report, it said that the economic impact of the second Covid-19 pandemic could be "much higher" and could lead to a more pessimistic growth of 8.8 per cent if mobility restrictions stay in place.

The State Bank of India (SBI) Research has revised India's FY22 growth to 10.4% from 11% projected earlier in view of the increasing COVID-19 related curbs across states.

Mudit Kapoor, Pragati Srivastava