The World Bank has said that the coronavirus epidemic has dealt a massive blow to the Indian economy. This will drastically bring down the country’s economic growth rate.
Corona big challenge for the economy:
The World Bank on Sunday reported “Latest Estimates on South Asia’s Economy: Impact of Covid-19” report that the Indian economy will decline to 5 percent in 2019-20. Further, on a comparable basis in 2020-21, the economy’s growth rate will decline drastically to 2.8 percent.
The report said that the COVID-19 setback has taken place at a time when the Indian economy is already sluggish due to pressure on the financial sector. The government has imposed a countrywide lockdown to curb the epidemic. This has stopped the movement of people and affected the supply of goods.
GDP anticipates a major decline:
The report said the economic growth rate will come down to 2.8 percent in 2020-21 due to domestic supply and demand being affected by The Covid-19. The increase in global risks will also delay the improvement in domestic investment.
The report says that the economy will be able to grow by 5 percent after the impact of Covid-19 ended in the next financial year i.e. 2021-22. However, this will require the support of a financial and monetary policy to the economy.
Small businesses more affected
In a conference call with reporters, World Bank chief economist Hans Timmer said India’s scenario is not good. Timmer said that if the lockdown in India continues for longer, the economic consequences here could be worse than the World Bank estimates. Replying to a question, Timmer said that at the same time, India must protect small and medium enterprises from bankruptcy.
He said that in order to meet this challenge, India must first stop the epidemic from spreading further, and also ensure that everyone gets food. In addition, India will have to focus on temporary employment programs, especially locally, Timmer said.