Goldman Sachs projects India GDP to shrink 10.3%, less than September forecast, in FY21
The investment bank has said India's economy will not fall as sharply as previously estimated due to the progress in vaccine development. GDP is set to surge 13 percent in the next financial year.
November 17, 2020 / 07:28 PM IST
Investment bank Goldman Sachs expects India's gross domestic product (GDP) to contract by 10.3 percent in the financial year 2020-21, expecting an uptick in the economy from its previous estimate in September of a 14.8 percent contraction.
The American firm projected India’s GDP to rebound to 13 percent in the succeeding fiscal, FY22.
According to a report from PTI, Goldman Sachs said that the developments on the vaccine front — where two candidates, Pfizer and Moderna, have posted satisfactory progress — will be very helpful in the recovery.
The Reserve Bank of India (RBI) expects India's GDP to contract by 9.5 percent on a real basis during the ongoing fiscal due to the impact suffered by the economy during the COVID-19 pandemic.
Per the Goldman report published on September 17, India's GDP will stage an impressive recovery in FY22, with a growth of 13 percent on the low base and the benefits of the vaccine.
"There is still a high degree of uncertainty around the outlook – and growth could significantly overshoot or undershoot these forecasts – depending on the course taken by the virus and vaccine-related developments in the coming year," it said.
It expects a normalisation in the containment policies and mobility restrictions only in mid-2022, once a vaccine is deployed.
--With inputs from PTI