coronavirus In the June quarter of the current financial year 2021-22, from the ‘lockdown’ imposed in April and May of the states to control the second wave of the epidemic. Economy The economy may decline by 12 percent in the same quarter a year ago, compared to a fall of 23.9 percent in the same quarter. Switzerland-based brokerage company UBS Securities said this in a report.
Last year, the two-and-a-half-month nationwide ‘lockdown’ imposed at the central level at just four hours’ notice had hit the economy hard and contracted by 7.3 per cent in the financial year 2020-21. It had a very adverse effect in the first quarter and the GDP declined by 23.9 percent. The situation improved slightly in the second quarter and the economy contracted by 17.5 percent.
However, there was a rapid revival in the second half. The growth rate in the third quarter of the year was 0.4 percent. At the same time, it increased to 1.6 percent in the fourth quarter. Due to this, the overall decline was limited at 7.3 percent in 2020-21.
Swiss brokerage company UBS Securities India has said in a report that a 12 per cent fall in the current financial year 2021-22 will make it difficult for the economy to grow in a V (rapid growth after a fall) shape this time around, as compared to the previous national growth rate. The level was seen after the ‘lockdown’ was lifted. He said that the reason for this is that consumer sentiment remains weak this time because people are very worried about the impact of the second wave of the epidemic compared to last year.
Hope to pick up pace in second half
Swiss brokerage economist Tanvi Gupta Jain, citing internal data from UBS India, said that whatever the indicators are, they point to a 12 per cent decline in the economy in the quarter ended June 2021. This situation is when the indicator improved by 3 per cent on a weekly basis to 88.7 for the week ending June 13 due to the easing of restrictions imposed at the local level from the last week of May in various states. However, the brokerage company has expressed hope of better economic activity on a monthly basis from June. But the momentum in the economy will probably be seen only from the second half.
He said that there was a rapid growth after the fall in 2020, but this time it is not likely to be like that. This time there will be a gradual revival in the economy as consumer sentiment remains weak due to the uncertainties associated with the pandemic. According to the economist, consumer and business confidence is likely to increase with the pace of vaccination. This is expected to accelerate the economic revival from the second half.
(This news has not been edited by NDTV team. It has been published directly from Syndicate feed.)