Goldman Sachs on Sunday projected 5% fall in the GDP for 2020-21 will be deeper compared to all recessions India has ever experienced.
New Delhi| Goldman Sachs anticipates India will experience its deepest recession ever after a poor run of data emphasised the damaging economic impact of national lockdown in the world’s second-most populous nation.
The GDP will shrink by an annualized 45% in the second quarter from the prior three months, compared with Goldman’s previous projection of a 20% slump. A greater rebound of 20% is now seen for the third quarter, while forecasts for the fourth quarter and first of next year are constant at 14% and 6.5%.
Those estimations indicate that real GDP will fall by 5% in the 2021 fiscal year, which would be deeper than any other recession India has ever experienced, Goldman economists wrote.
Earlier, it had estimated Indian growth to shrink 20% in the 3 months to June & 0.4% in Financial Year 2021. It has also changed its global growth forecast from -2.5% to -3.6% for 2020, with risks prevailing on the downside.
“In India, the virus continues to spread, the nationwide lockdown continues till 17 May and the Prime Minister already announced it will be extended, with the gradual relaxation of restrictions, while concerns among consumers and businesses continue. The deeper trough in our Q2 forecasts reflects the extremely poor economic data we have received so far for March and April, and the continued lockdown measures, which are amongst the harshest across the globe,” it added.
The report was published before the central government extended the lockdown to 31 May.
However, the restrictions have been eased in certain sectors to boost economic activity, as COVID-19 cases continue to surge across the nation.
The total cases in India surged to 96,169 including over 36,000 cured/discharged or migrated and 3,021 deaths amid lockdown to curb the spread of COVID-19.
In the past 24 hours, 157 casualties were recorded.
A staggering 5,034 new cases of COVID-19 were recorded in the last 24 hours, highest so far.
Maharashtra, the worst affected state by the virus, reported 33,053 with over 1,198 deaths. It also recorded it’s the highest spike with 2000 cases in the last 24 hours.
(Inputs from Agencies)