Global brokerage firm Barclays has cut India’s GDP growth forecast for FY 2022. Barclays lowered India’s GDP growth forecast for FY2022 to 10 percent from the earlier 11 percent due to the uncertainty created by the slow pace of vaccination and the rapid increase in infection rates and the death toll in the second wave of coronavirus.
The brokerage firm said that if the current local lockdown goes on until June, it would cause an economic loss of $ 38.4 billion. Barclays warned that in the more pessimistic scenario of the epidemic if the control could not be achieved soon and restrictions on movement continue until August, the growth rate could fall to 8.8 percent.
The country’s economy is projected to shrink at a rate of 7.6 percent in FY 2021, as the nationwide lockdown caused by the epidemic halted economic activity and severely impacted demand and employment. The low base was expected to witness a faster growth rate in FY 2022, but the second wave of the Coronavirus pandemic and the local lockdown it has caused many analysts to downgrade their forecasts. The Reserve Bank of India has said that the economy will grow at a rate of 10.5 percent in this financial year.
Barclays analysts said, “As the second wave of the corona epidemic continues in India, there is increasing uncertainty about the number of infections and deaths.” Slow vaccination is also affecting India’s recovery prospects. We reduce the GDP growth estimate for FY 2021-22 by one percent to 10 percent due to this uncertainty. ‘
