The Organisation for Economic Cooperation and Development (OECD) has lowered India’s Gross Domestic Product (GDP) growth forecast to 5.1 per cent from its earlier projection of 6.2 per cent for 2020 following concerns over the impact of the COVID-19 outbreak on the domestic as well as the global economy.
The OECD said the adverse impact on confidence, financial markets, travel sector and disruption to supply chains contributes to the downward revisions in all the G20 economies in 2020, particularly ones strongly interconnected to China.
According to the latest OECD Interim Economic Outlook Forecasts, India’s real GDP growth is expected to peak at 5.1 per cent during the fiscal year starting April 1, 2020, and improve to 5.6 per cent in the following year. The latest projection for 2020-21 is 1.1 percentage point lower than the November 2019 forecast.
The Economic Survey tabled by the government in the Indian Parliament has projected India’s economic growth at 6-6.5 per cent in the next fiscal year. The National Statistical Office (NSO) estimates India's GDP growth at 5 per cent during 2019-20.
The OECD has projected India’s growth at 4.9 per cent for the financial year ending March 2020.
The report said the coronavirus outbreak has already brought considerable human suffering and major economic disruption.
Output contractions in China are being felt around the world, reflecting the key and rising role China has in global supply chains, travel and commodity markets.
Subsequent outbreaks in other economies are having similar effects, albeit on a smaller scale. Global manufacturing declined in February the most since 2009 as the coronavirus severely disrupted demand, trade and supply chains.