'Growth will be lowest since 1947': Noted Economist Kaushik Basu raises concern about India's economy in FY20

Taking to microblogging platform Twitter, Former Chief Economist of the World Bank, Kaushik Basu, said that it is likely that India's economic growth in 2020-21 will be the lowest since 1947.

"The only parallels to such growth were in colonial times," Basu said.

The Professor of Economics at Cornell University said that divisiveness and lack of trust are hurting investment and job creation in the country.

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"The government should now focus on major policy initiatives," Basu added.

All economies are doing badly & India particularly so. It’s likely that growth in 2020-21 will be the lowest since 1947. The only parallels to such growth were in colonial times. Divisiveness & lack of trust is hurting investment & job creation. Time for major policy initiatives.

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— Kaushik Basu (@kaushikcbasu) August 9, 2020

While the World Bank had projected the Indian economy to contract 3.2 percent, the International Monetary Fund (IMF) and Asian Development Bank (ADB) pegged it at 4.5 percent and 4 percent respectively. S&P and Fitch have projected a 5 percent contraction, while Nomura said growth would be (-)5.2 percent in 2020-21.

More recently, domestic rating agency ICRA revised its forecast for contraction in the country's GDP in the current fiscal to 9.5 percent from 5 percent earlier, saying continued lockdowns in some states have affected the recovery seen in May and June.

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