Rising corona patients will put a break on the economy on track
Partial layoffs could push GDP down, report from US brokerage firm BOFA Securities
Mumbai: Claims that India’s economy is recovering are still shallow, with a growing number of corona patients and a month-long partial layoff due to government announcements that could lead to a 2 per cent drop in GDP, according to a report by US brokerage firm BOFA Securities.
Corona outbreaks have increased six-fold to 1.03 lakh, the report said. Therefore, the state government has to announce a lockout at the local level and a partial lockout in the state. Also, there are no signs of corona outbreaks and if they continue to rise, there could be a national lockout. Against this backdrop, the ongoing economic growth is a sign of shallowness.
If the number of Kovid-19 patients continues to rise and a national lockout is announced, we estimate that 100-200 bps of annual GDP could be hit. So it can be said that this is a threat to the economy.
The increase in the number of corona patients last year was a major blow to the previous financial year, when GDP fell by seven per cent. Analysts are predicting a double-digit GDP growth in FY2021-22.
Tags: American brokerage firm, BOFA Securities, Mumbai, The economy will take a break