INDIA’S economic output in 2021 is expected to remain below the 2019 level despite the rollout of the Covid-19 vaccine, a report by the United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP) said.
The report observed that the country entered the pandemic with subdued GDP growth and investment. “Following one of the most stringent lockdowns in the world, the economic disruptions that the country experienced mounted in the second quarter of 2020.”
It added that a subsequent change in lockdown policies and success in reducing infection rates supported an impressive economic turnaround in the third quarter
“However, the pace of recovery moderated in the fourth quarter with estimated year-on-year growth still close to zero.
“Despite a robust reduction in new Covid-19 cases and the start of vaccine rollout, India’s 2021 economic output is expected to remain below the 2019 level,” it said.
Meanwhile, maintaining low borrowing costs while keeping non-performing loans in check would be a challenge, according to the report published on Tuesday (30).
In its second advance estimates of national accounts, the National Statistical Office (NSO) has projected an 8 per cent contraction in 2020-21, showing the pandemic impact.
The report pointed out that China’s swift and effective response to COVID-19 enabled it to become the only major economy worldwide to achieve a positive annual economic growth rate in 2020.
The report forecasts that on an average, developing Asia-Pacific economies are expected to grow 5.9 per cent in 2021 and 5 per cent in 2022, after having experienced an estimated contraction of one per cent in 2020
Despite a reasonably strong rebound expected in 2021, a ‘K-shaped recovery’ is likely, with poorer countries and more vulnerable groups marginalised in the post-pandemic recovery and transition period,” it said
Produced annually since 1947, the Economic and Social Survey of Asia and the Pacific is the oldest United Nations report on the region’s progress.