Image : Representational Purpose Only
Moody’s Investors Service in its latest report has slashed India’s growth forecast for the current financial year to 9.3 per cent saying that the second wave of coronavirus infections hampers economic recovery and increases risk of longer-term scarring.
Moody’s, which has a ‘Baa3’ rating on India with a negative outlook, said obstacles to economic growth, high debt and weak financial system contrain sovereign credit profile.
The US-based rating agency had in February forecast a 13.7 per cent economic growth for the current fiscal (April 2021-March 2022).
As per official estimates, the Indian economy contracted 8 per cent in the previous fiscal ended March 2021.
“India is experiencing a severe second wave of coronavirus infections which will slow the near-term economic recovery and could weigh on longer-term growth dynamics.
“The surge of the virus, which has been driven by a highly contagious variant, has put significant strain on India’s healthcare system with hospitals overrun and medical supplies in short supply,” Moody’s said.
