As a result of a slight decrease in coronavirus cases and an uptick in high-frequency economic data, the country’s gross domestic product (GDP) is expected to return to expansion territory in October-December quarter, growing by 0.8 per cent year-on-year (YoY), according to multinational bank Barclays. Hit by the COVID-19 pandemic and the nationwide lockdown imposed by the government in late March last year to control the spread of infections, the country’s GDP contracted by 23.9 per cent in April-June and 7.5 per cent in the July-September quarter.
“We expect India’s GDP to return to growth in Q3 FY2020-21 (October-December 2020), after contracting for two quarters. We forecast Q3 GDP will rise 0.8 per cent y/y, taking into account latest high-frequency data, posing mild upside risks to our FY2020-21 GDP forecast of -6.5 per cent. We maintain our FY2021-22 GDP at 8.5 per cent y/y and see some upside risks,” Barclays Chief India Economist Rahul Bajoria said.
The Reserve Bank of India has projected a 10.5 per cent GDP growth in financial year 2021-22.