India’s economic output in 2021 is expected to remain below the 2019 level despite the roll-out of the vaccine to deal with the menace of the coronavirus pandemic, said a report by the United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP) released on Tuesday. India, according to the ‘Economic and Social Survey of Asia and the Pacific 2021: Towards post-COVID-19 resilient economies’, is estimated to record economic growth of 7 percent in 2021-22, over a contraction of 7.7 percent witnessed in the previous fiscal on account of the pandemic’s impact on normal business activity.
Observing that India entered the pandemic with subdued GDP growth and investment, the report said, “Following one of the most stringent lockdowns in the world, the economic disruptions that the country experienced mounted in the second quarter of 2020.” It added that a subsequent change in lockdown policies and success in reducing infection rates supported an impressive economic turnaround in the third quarter.
“However, the pace of recovery moderated in the fourth quarter with estimated year-on-year growth still close to zero. Despite a robust reduction in new COVID-19 cases and the start of vaccine roll-out, India’s 2021 economic output is expected to remain below the 2019 level,” it added. Meanwhile, maintaining low borrowing costs while keeping non-performing loans in check would be a challenge, it added. The report further said China’s swift and effective response to COVID-19 enabled it to become the only major economy worldwide to achieve a positive annual economic growth rate in 2020.