SBI cuts India's FY22 GDP growth to 10.4%

Wednesday 28th April 2021 06:05 EDT

State Bank of India (SBI) has revised downwards India's GDP growth projections for the current fiscal year from 11% to 10.4%, citing the partial lockdowns in most of the states. The total loss due to the partial lockdowns, night curfews has been estimated at £15 billion of which Maharashtra, Madhya Pradesh and Rajasthan account for 80%. Maharashtra alone accounts for 54% of the total losses. “Maharashtra has put up a stringent lockdown among all states. Being the economically biggest and most industrialised state in India, this lockdown will have a huge impact on growth,” Soumya Kanti Ghosh, group chief economic adviser at SBI, said in his report.

The report said the current losses in Maharashtra are estimated at nearly £8.2 billion, which will definitely increase if restrictions are further increased. “Given that R(0) is quite low for Maharashtra, it may be pertinent to ask that how much the lockdown will slowdown the speed of infections, but for beefing up health infrastructure,” said Ghosh.

The report also said that migration of labour is continuing unabated. According to the data provided by Western Railways (for the period of April 1-12), almost 430,000 people have returned to the states like UP, WB, Bihar, Assam and Odisha from Maharashtra. Of this, around 320,000 reverse migrated to UP and Bihar alone. “From Central Railways our estimate indicates that around 470,000 reverse migrated to northern and eastern states from Maharashtra,” it said.

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