India’s GDP may fall by 3.1%, will accelerate in 2021: Moody’s

(Kajal Singh journalist):
Moody’s had lowered India’s credit rating by a notch earlier this month to ‘BAA3’. This is the lowest rating category investable.
New Delhi: Credit rating agency Moody’s Investors Service has predicted a 3.1 percent decline in the size of the Indian economy in 2020. The agency also feared a change in geographical conditions in Asia due to tensions at the border between India and China. Earlier, Moody’s had projected a 0.2 percent increase in India’s gross domestic product (GDP) in April in 2020. Now the agency has revised its estimate regarding the impact of the corona virus epidemic.
However, Moody’s believes that after 2021, the Indian economy will return rapidly and may register a growth rate of 6.9 percent.
April-June worst quarter
Moody’s said in its June update of the Global Macro Outlook (2020-21) that it revised its 2020 growth forecast for India as the data showed the impact of disruptions caused by the corona virus epidemic in the January-March and April-June quarters. Is being detected He said, “The April-June quarter of 2020 will be recorded in history as the worst quarter for the global economy since at least World War II. We continue to expect a gradual return in the second half of the year , But this result will depend on whether governments can reopen their economies while protecting public health. “
China is the only G20 country to register a boom
Moody’s has predicted that China will be the only G20 country to register a boom this year. The agency expects China to accelerate at a rate of one per cent in 2020 and 7.1 per cent in 2021 thereafter.
Asian countries are particularly sensitive to changes in geopolitical dynamics. Increasing tensions between China and some countries along the border of South China Sea and skirmishes along the border with India indicate that geopolitical risks are increasing for the entire region.
Last week, 20 Indian Army personnel, including a colonel, were killed in a violent confrontation with Chinese soldiers in the Galvan Valley of eastern Ladakh. This has increased the border tension between the two countries. Moody’s expects the G20 economy to fall by 4.6 percent in 2020, followed by 5.2 percent growth in 2021. Moody’s had lowered India’s credit rating by a notch earlier this month to ‘BAA3’. This is the lowest rating category investable.