The Asian Development Bank’s (ADB) Asian Development Outlook (ADO) 2021 Supplement has reduced India’s GDP growth forecast for FY22 by 1 percent to 10 percent, from its earlier projection of 11 percent due to COVID-19.
ADB’s Projection for India:
i.The GDP growth estimation for FY23 was increased by ADB to 7.5 percent from its earlier projection of 7 percent.
ii.ADB stated India’s GDP growth recovery in Q4 of FY21 at 1.6 percent.
- Due to the rise in the price of food and fuel, Indian consumer price inflation rose to 6.3 percent year on year in May 2021.
- Hence India’s Inflation forecast for FY21 was increased by ADB from 5.2 percent to 5.5 percent, whereas the inflation forecast for FY22 was kept unchanged at 4.8 percent.
iv.ADB’s projection towards inflation indicated successive inflation for 3 years at the range of 6 percent (The inflation target set by RBI was 2-6 percent).
Note – The Reserve Bank of India (RBI) has projected retail inflation for FY22 at 5.1 percent.
i.ADB has decreased developing Asia’s economic growth projection in 2021 at 7.2 percent from its earlier projection of 7.3 percent. The growth outlook for 2022 was also increased from 5.3 percent to 5.4 percent.
ii.Asia Pacific region’s annual inflation forecast for 2021 was increased to 2.4 percent from 2.3 percent, the forecast for 2022 is expected to be 2.7 percent.
Recent Related News:
On May 14, 2021, the Asian Development Bank (ADB) committed $3.92 billion in sovereign loans for 13 projects to India in 2020, including $1.8 billion in projects to support the Government of India’s coronavirus disease (COVID-19) pandemic response.
About Asian Development Bank (ADB):
Establishment – 1966
Headquarters – Manila, Philippines
President – Masatsugu Asakawa
Members – 68 members (49 within Asia and the Pacific, 19 outside)