Indian economy seen ‘shrinking 12 per cent in April-June’
THE INDIAN economy is likely to register a 12 per cent contraction in the June quarter of fiscal year 2021-22, against a 23.9 per cent decrease in the same quarter previous year, according to a brokerage report.
The imposition of lockdowns by states during April-May to control the spread of the Covid-19 pandemic may trigger this fall, Swiss brokerage UBS Securities India said.
India’s economy witnessed its worst contraction in fiscal year 2021 at 7.3 per cent following an unprecedented lockdown of more than two months that crippled the economy.
With a 12 percentage point reduction, India is likely to miss a sharp V-shaped recovery, unlike last year when the national lockdown was lifted, the brokerage said.
Consumer sentiment is weak as people are more worried about the pandemic this year than last year, it said.
The brokerage expects a sequential recovery in economic activity from June; however, it may gain strength only from the second half, when the vaccination drive may pick up pace.
The vaccination drive has improved in India to 3.2 million doses daily in the week to June 13 from 2.5 million in May.