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GDP TO SHRINK 14.8%: GOLDMAN

Focus: GS-III Indian Economy

Why in news?

The Indian economy is the worst-hit among major economies, American brokerage Goldman Sachs said, sharply cutting its FY21 GDP forecast to a contraction of 14.8%.

Details

  • The estimate comes days after official data said the economy contracted by 23.9% for the June 2020 quarter, as activity across all sectors barring agriculture contracted due to the lockdowns.
  • The 14.8% contraction is among the most pessimistic of all the analyst estimates till now.
  • Earlier, analysts at India Ratings and Research revised down their estimate to an 11.8% contraction for FY21, while economists at India’s largest lender SBI are now expecting a 10.9% contraction.
  • The brokerage said there would be a sharp rebound in FY22 due to the low base.
  • It estimated GDP growth of 15.7% in the next fiscal. Assuming 70% of the output lost in June is recovered in June 2021, they expect real GDP growth of 27.1% in the April-June 2021 quarter.

-Source: The Hindu

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