On June 22, 2020, According to the Moody’s Global Macro Outlook report for June 2020, there will be a contraction of 3.1 % in India’s gross domestic product (GDP) in 2020 & expects a change in geographical conditions in Asia due to tensions at the border between India and China.
Previously in April 2020, Moody’s had forecasted a 0.2 % increase in India’s GDP in 2020. The agency has now revised its estimate of the impact of the coronavirus (COVID-19) epidemic.
Expect better GDP in 2021:
The slight relief for India is that GDP will reach the level of 6.9% in 2021. Till then, there will be a slow recovery in the Indian economy, which will start from the second half (H2) of this year.
China will be the only country to register growth in the G20 group:
- On a larger scale, in this report, it has been said about the economy of the G20 (Group of 20) countries for 2020 that a contraction of 4.6 % will be seen. But, in 2021, these economies will grow at a rate of 5.2 %.
- China will be the only G-20 country to record growth in 2020 with a growth rate of 1 % and 7.1 % in 2021 thereafter.
Effect of geopolitical tension:
- Moody’s has also been feared that geo-political tension will also determine how accurate the current growth projections are for India and the global economy &the effect of geopolitical tension is likely to be the biggest on Asian countries.
- China’s skirmishes with neighboring countries from the South China Sea and geopolitical risk with India will be important for the entire region.
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