Published 23:50 IST, October 13th 2020
Indian economy to dip 10.3% in 2020; rebound with 8.8% growth in 2021: IMF
China remains the only economy with positive growth projection in 2020 while all other countries in the world have negative growth projections for current year
As the COVID-19 pandemic has adversely impacted the world economy by causing a health crisis leading to an economic fallout on almost all the countries across the world, the International Monetary Fund (IMF) projected the Indian economy to contract by a massive 10.8% this year as a result of the pandemic. However, in a piece of good news, the IMF in its report titled 'World Economic Outlook' also asserted that the Indian economy will bounce back to 8.8% growth the next year and again become the fastest-growing emerging economy in the world, followed by China at 8.2%.
The Reserve Bank of India (RBI) had earlier this month projected that the GDP would contract by 9.5 per cent in the current financial year amid disruptions caused by the coronavirus pandemic and it may turn positive in the last quarter.
World economy to dip by 4.4%
IMF also said global economic growth is estimated to dip by 4.4% in 2020, only to rebound with 5.2% growth in 2021. According to the IMF report, the advanced economies are expected to decline by 5.8% followed by a rebound in growth to 3.9% in 2021. The economic growth of the developed countries such as the US, Japan and the UK is projected to shrink by 4.3%, 5.3% and 9.8% respectively.
"All emerging market and developing economy regions are expected to contract this year, including notably emerging Asia, where large economies, such as India and Indonesia, continue to try to bring the pandemic under control," the IMF said in its report which was released ahead of the annual meeting of the IMF and the World Bank.
Looking at the impact of the ongoing coronavirus, the IMF said that social distancing due to the coronavirus pandemic will continue into 2021. The report contended that local transmissions will fall everywhere by the end of 2022.
China, the only economy in positive projection for 2020
China, from where the catastrophic COVID-19 was originated and spread across the world causing a health and economic crisis, remains the only economy in the world with positive growth projection in 2020. According to the IMF report, China's projection in 2020 is 1.9% while all other countries in the world including the developed and the developing have negative growth projections for the current year.
Updated 23:50 IST, October 13th 2020