Revising its growth forecast for India during FY2020-21, Fitch Ratings last Friday projected GDP growth as against 5.6 percent projection issued in December. The agency maintained downward revision owing to Coronavirus crisis which has begun to hit India and is likely to seriously impact investment and exports.
In its Global Economic Outlook 2020, Fitch said the number of people affected by coronavirus in India will keep rising in the coming weeks but that the outbreak will remain contained. However, there are downside risks to this scenario. “Supply-chain disruptions are expected to hit business investment and exports… We see GDP growth to remain broadly steady at 5.1 per cent in the fiscal year 2020-2021 following growth of 5.0 per cent in 2019-2020,” Fitch said.
Fitch estimate for India is similar to projections made by other leading international agencies – Standard and Poor’s (S&P) revised estimate for India is 5.2% and Moody’s and the Organisation for Economic Cooperation and Development (OECD) have cut their 2020 growth projections for India to 5.3% and 5.1%, respectively.