S&P raises India's FY21 GDP forecast to -7.7%

S&P Global raises India's 2020-21 economic growth forecast to a contraction of 7.7 percent, as against -9 percent projected earlier, CNBC-TV18 reported.

December 15, 2020 / 02:58 PM IST

S&P Global Ratings on December 15, raised India's 2020-21 Gross Domestic Product (GDP) forecast to a contraction of 7.7 percent, as against -9 percent projected earlier.

S&P Global did not change its projection that the Indian economy would grow 10 percent in FY22. The revision in growth forecast reflects a faster-than-expected recovery in the quarter through September, the rating agency said.

"Rising demand and falling infection rates have tempered our expectation of COVID's hit on the Indian economy. S&P Global Ratings has revised real GDP growth to negative 7.7 percent for the year ending March 2021, from negative 9 percent previously," S&P said in a statement.

Also read: Analysts narrow FY21 GDP outlook over July-September data

India's economy plunged 23.9 percent in the first quarter of FY21 due to the impact of the COVID-19 pandemic. In Q2FY21, there was slight recovery, with GDP contracting 7.5 percent.

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India is in technical recession, but macro-economic indicators have seen an uptick after resumption of manufacturing and other economic activity.

"It is no surprise that India is following the path of most economies across Asia-Pacific in experiencing a faster-than-expected recovery in manufacturing production," S&P Global Ratings Asia-Pacific chief economist Shaun Roache said.

Fitch Ratings, too, had on December 8 revised India's FY21 GDP forecast upwards to -9.4 percent from an earlier estimate of -10.5 percent.

(With inputs from PTI)
Moneycontrol News
first published: Dec 15, 2020 01:40 pm

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