India's second COVID-19 wave may impede economic recovery: S&P
"In addition to the substantial loss of life and significant humanitarian concerns, S&P Global Ratings believes the outbreak poses downside risks to GDP and heightens the possibility of business disruptions," the rating agency said in a note.
April 28, 2021 / 11:49 AM IST
Credit rating agency S&P Global said on Wednesday the second wave of COVID-19 infections in India could impede the country's economic recovery and expose other nations to further waves of outbreaks.
"In addition to the substantial loss of life and significant humanitarian concerns, S&P Global Ratings believes the outbreak poses downside risks to GDP and heightens the possibility of business disruptions," the rating agency said in a note.Follow our LIVE blog for latest updates of the novel coronavirus pandemic
India's healthcare system has been overwhelmed, with the world's second most populous country reporting more than 300,000 new COVID-19 cases daily over the past six days and the death toll set to cross 200,000.
Also Read: COVID-19 vaccines | Bharat Biotech's Covaxin found to neutralise '617' coronavirus variant: Dr Anthony Fauci
S&P, which has a long-term credit rating of 'BBB-' on India, just one notch above junk, said it may have to revise its base-case assumption of 11 percent growth over fiscal 2021/2022, especially if wider containment measures are re-imposed.
Also Read: States, UTs cannot vaccinate 18-44 age group with government's supply, Centre clarifies
S&P expects the consumer retail and airport sectors to have a dragged out recovery with localized lockdowns and curfews in several parts of the country, and said the Indian banking sector continued to face a "high level of systemic risk".
The rating agency noted that the pace and scale of recovery from the second wave of COVID-19 infections will have implications for India's sovereign credit rating.
The Asia-Pacific region is susceptible to contagion from the highly infectious COVID-19 variants present in India, given the low ratios of vaccination in the region, S&P said.Follow our full coverage of the coronavirus pandemic here.