Current Affairs PDF

India’s GDP Estimated to Grow in the range of 7.5% to 12.5% in FY22: World Bank report 

AffairsCloud YouTube Channel - Click Here

AffairsCloud APP Click Here

India real GDP growthOn March 31, 2021, The World Bank reported its South Asia Economic Focus report for the year 2021, titled “Sour Asia Economic Focus Spring 2021: South Asia Vaccinates” and it has estimated India’s GDP (Gross Domestic Product) growth to be in the range of 7.5% to 12.5% for the Financial year 2021-22 (FY22) and contraction of 8.5% (-8.5%) for FY21.

Key points of the report:

  • The World Bank has increased the GDP growth rate of India by 4.7% to 10.1% for FY22, due to private consumption and investment growth. It has reported a 5.4% growth in its January report.
  • The poverty rate (at the $1.90 line) for the South Asian group is projected to be within 6% and 9% in FY22, and between 4% and 7% by FY24.

World Bank’s projection for India:

  • The growth for FY22 was estimated based on the proceedings of the vaccination campaign, recovering of world economy and restrictions to mobility.
  • The general government deficit is expected to remain above 10% of GDP until FY22 and which will result in public debt at a peak of almost 90% of GDP in FY21.
  • The current account is expected to return to mild deficits of around 1% in FY22 and FY23.
  • World Bank’s projection compared well with IMF which predicted GDP growth rate to be 11.5 per cent during FY22 and Economic Survey which forecast it at 11%.
  • The government’s consumption is expected to rise by about 16.7% during FY21.
  • It expected that Covid-19 might lead to a long-lasting inflexion in India’s fiscal path.

Poverty reduction:

  • As South Asian countries’ growth resumes and the labour market prospects improved, poverty reduction is expected to return to its pre-pandemic track.
  • The income gap between the poorest (90% of the population) and the richest (10%) was widened even further in India due to COVID-19 by 13.2% points.

Recent Related News:

According to the Global Economic Prospects (GEP-January 2021) report released by the World Bank (WB), India is expected to grow at 5.4% in the Financial Year (FY) 2021-22 & 5.2% in FY 2022-23 after an expected contraction of 9.6% in FY 2020/21. The Global Economy is expected to expand by 4% in 2021.

About World Bank:

Establishment – 1944 as The International Bank for Reconstruction and Development
President – David Robert Malpass
Headquarters – Washington, D.C., United States