India's gross domestic product (GDP) is likely to contract by 4.5 per cent in the April-June 2020 quarter despite the Reserve Bank of India's (RBI) massive actions to spur the economy, according to rating agency ICRA, which said the GDP will rise by only 2 per cent in 2020-21 because of the rapidly growing uncertainties over the duration of the COVID-19 impact.
The Indian economy was already supposed to clock a decadal low growth of 5 per cent in 2019-20, according to official estimates.India's gross domestic product (GDP) is likely to contract by 4.5 per cent in the April-June 2020 quarter despite the Reserve Bank of India's massive actions to spur the economy, according to rating agency ICRA, which said the GDP will rise by only 2 per cent in 2020-21 because of the rapidly growing uncertainties over the duration of the COVID-19 impact.#
The rating agency welcomed the RBI policy measures as a set of ‘comprehensive announcements’, a newswire reported.
"The combination of moratoriums, liquidity enhancing measures and the sharper-than-hoped-for repo rate cut will help to assuage the markets in these increasingly unsettled times, and offer some protection against widespread defaults, even though the actual impact on boosting economic activity may be limited," it said.
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