InvestorQ : What is likely to be the overall impact of COVID-19 on the GDP growth of India for the next few quarters?
ishika Banerjee made post

What is likely to be the overall impact of COVID-19 on the GDP growth of India for the next few quarters?

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Niti Shenoi answered.
1 year ago
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There are varying estimates in the market but Nomura has recently come out with elaborate projections for India on a quarterly basis. It projects Indian economy to grow at 3.2% in the Jan-Mar period but contract by (-6.1%) in Mar-Jun quarter and again contract by (-0.5%) in the Jun-Sep quarter. However, the growth is expected to turn around to a positive 1.4% in the Sep-Dec quarter. Here Nomura has built in the assumption that the RBI would cut rates by another 75 basis points in all. This is largely the outcome of the three-week lockdown of India in the light of the Coronavirus infection. India’s GDP growth for FY21 is estimated at +4.8%, although it does look quite optimistic at this point of time. Nomura also estimates that unconventional monetary policies will include a commitment towards aggressive open market operations, further liquidity injections via targeted long term repo operations and further forbearance measures. The outlook is not too bright for the next few quarters.

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