Indian economy to shrink by 9% this fiscal: Asian Development Bank

Bangladesh economy shows early signs of recovery GDP to grow at 6.8% for FY 2021 ADB

India's economic growth will contract by 9 per cent in the current fiscal as the coronavirus pandemic weighs heavily on economic activity and consumer sentiment in the country, according to ADB.

In the primary quarter of the present fiscal 12 months, India's GDP contracted by a document 23.9 per cent as lockdowns stalled shopper and enterprise spending.

In contrast, India, which is one of the hardest-hit countries in the world with more than 4.8 million cases despite lengthy lockdowns, is expected to see its economy shrink by nine percent in 2020 before expanding by eight percent next year.

"Developing Asia", which groups 45 countries in Asia-Pacific, is expected to contract 0.7% this year, the ADB said, forecasting the first negative quarterly figure since 1962.

ADB economists say the developing economies in the Asia-Pacific region will contract by 0.7 percent. That will still leave next year's level of GDP below pre-coronavirus projections, implying that the recovery is only "partial" and "not full".

About three-quarters of the area's economies are anticipated to publish adverse development in 2020.

Policies focused on protecting lives and livelihoods, and ensuring a safe return to work and restart of businesses, are crucial to ensuring a sustained recovery for the region, he said.

Other draw back dangers come up from geopolitical tensions, together with an escalation of the commerce and expertise battle between the United States and China in addition to monetary vulnerabilities that could possibly be exacerbated by a protracted pandemic.

Growth in Developing Asia - a region that excludes advanced nations like Japan, Australia and New Zealand - will rebound to 6.8% in 2021, in part because it will be measured against a weak 2020, Sawada said.

After successfully beating back the disease, the world's second largest economy is forecast to grow 1.8 percent this year and 7.7 percent in 2021, the bank said.

The economy is expected to rebound in 2021 as the outbreak is contained, the economy is further opened, and more government stimulus measures are implemented.

"The path and speed of economic recovery in regional economies will depend on many different factors, the most important of which is [the] ability to control and contain the pandemic", the ADB said.

The inflation forecast for developing Asia is revised downwards to 2.9 per cent this year from 3.2 per cent forecast in April due to continued low oil prices and weak demand. Inflation for 2021 is expected to ease further to 2.3%.

The update to ADO 2020 features a theme chapter, Wellness in Worrying Times, which discusses the importance of wellness as communities recover from COVID-19's toll on physical and mental health. The chapter explains that wellness can be an engine of inclusive economic growth if the region leverages its rich wellness traditions, and appropriate policies are promoted by governments.

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