India’s GDP to shrink 10.3% in FY21, says IMF

The International Monetary Fund (IMF) on Tuesday forecast Indias gross domestic product (GDP) to contract 10.3% in FY21, in a downward revision of its June forecast of a 4.5% drop, reflecting the worse-than-anticipated contraction in economic activity in the fiscal first quarter due to the nationwide lockdown, as well as the rapidly-spreading pandemic.

In its biannual World Economic Outlook, IMF said all emerging market and developing economy regions are expected to shrink this year, including notably emerging Asia, where large economies such as India and Indonesia continue to try to bring the pandemic under control.

“Revisions to the forecast are particularly large for India, where GDP contracted much more severely than expected in the second (June) quarter. As a result, the economy is projected to contract by 10.3% in 2020, before rebounding by 8.8% in 2021,” it added.