Categories: Business

moody's sees india economic growth to at zero in 2020-21


Growth outlook

new Delhi. Global credit rating agency Moody's Investors Service said on Friday that India's economic growth could be zero in the fiscal year 2020-21. It said the negative outlook for India's Savarn rating reflects the risk of its GDP growth rate being much lower than before. The agency said that along with this scenario also shows weak policy effects in terms of removing economic and institutional constraints.

Moody's said that the negative scenario also suggests that there is no possibility of improvement in the near future. He said that due to corona virus epidemic, high government debt, weak social and physical infrastructure and fragile financial sector may face further pressure. Moody's had reduced India's rating scenario from stable to negative in November 2019. However, the agency maintained the rating at BAA2. 'BAA2' is an investment grade rating with a mild debt risk.

Moody's warned that the shock from the Corona virus epidemic would further increase the already sustained softening of economic growth. This has also weakened the prospects of reducing the fiscal deficit earlier. The agency said in its new forecast that India's GDP growth could be zero in FY 2020-21. This means that the country's gross domestic product (GDP) situation will remain flat in this financial year. The agency has, however, projected growth to reach 6.6 percent in FY 2021-22.

This post was published on May 9, 2020 3:34 am

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