Fitch sees India GDP rise at slowest pace in 30 yrs

India may post in 2020-21 a gross domestic product growth rate of 2 per cent, the slowest since the economy was liberalised 30 years ago, Fitch Ratings said on Friday. Also, the Asian Development Bank said it saw India’s economic growth slipping to 4 per cent in the current fiscal year ending March 31, 2021.

Fitch Ratings on Friday said it had slashed India’s growth forecast for this fiscal year to a 30-year low of 2 per cent, from 5.1 per cent projected earlier, as economic recession gripped global economy following the lockdown because of the Covid-19 pandemic.

“The initial disruptions to regional manufacturing supply chains from a lockdown in China as the coronavirus spread have now broadened to include local discretionary spending and exports even as parts of China return to work. Fitch now expects a global recession this year and recently cut our GDP growth forecast for India to 2 per cent for the fiscal year ending March 2021 after lowering it to 5.1 per cent previously, which would make it the slowest growth in India over the past 30 years,” Fitch said.

On March 20, Fitch had projected India's GDP growth for 2020-21 at 5.1 per cent, lower than 5.6 per cent estimated in December 2019. Last week, Moody's sharply cut India's growth forecast for calendar 2020 to 2.5 per cent from 5.3 per cent.

The Asian Development Bank (ADB) on Friday said India's economic growth rate will slip to 4 per cent in this fiscal on account of the global health emergency created by the Covid-19 pandemic. At the same time, the multilateral lending agency in its flagship publication Asian Development Outlook (ADO) 2020 said that India will stage a strong recovery in the next financial year on the back of its sound macroeconomic fundamentals.

Indian expatriates in the US and other countries, who have lost their jobs or have a work permit that has expired, may not be able to return before the current ban on international flights is lifted, in view of the virus outbreak.

Senior government officials have confirmed that no evacuation flights to the US are on the radar, given the surge in cases to above 245,000

(as of Friday), in the country.

“For all jurisdictions, our first priority is students, tourists, and those on short-term visas. However, India’s six diplomatic missions across the US are in touch with affected citizens and preparing a tentative list of possible evacuees once and if evacuations do start,” said a senior official in the Ministry of External Affairs.

The ministry’s stance is based on the argument that “Indians currently abroad on employment visas like H-1B work in multinational firms, draw significant wages, and in many cases have retrenchment benefits”. People in the know said no meetings were scheduled with the US State Department regarding the matter.

On the other hand, those stuck in the US also face no official legal guidance as the US Citizenship and Immigration Services (USCIS) has temporarily suspended routine in