India: GDP revised lower to 2.0% - UOB

Economist at UOB Group, Barnabas Gan, gives his views on the GDP figures in India for the FY 2020-21.

Key Quotes

“India has extended its nationwide lockdown until 17 May 2020, from 3 May 2020. This marks the second time India has extended the lockdown, which was initially stipulated to end 14 April 2020.”

“The health ministry categorised 733 districts into coloured (red, orange, & green) zones. Depending on the coloured category, some easing of restrictions will be given, suggesting the first signs of government confidence that the COVID-19 pandemic is progressively curbed.”

“Coupled with the trade pains that began in 2019, the COVID-19 pandemic has injected further downside risks to India’s economic growth and inflation prospects. We downgrade GDP growth to slow further to 2.0% in the upcoming fiscal year 2020/21 (Apr 2020 to Mar 2021), down from our initial outlook of 4.0%. Inflation is also pencilled to slow to 3.5% over the same period.”