UNCTAD projects India 2021 economic growth at 7.2%

India’s recovery will be constrained by the human and economic cost of two consecutive waves of coronavirus pandemic and the impact of food price inflation on private consumption, UNCTAD said on Wednesday, projecting Asia’s third largest economy to grow at 7.2% in the 2021 calendar year.
“In India, consumer inflation was already at 6% before the pandemic. The covid-19 shock caused a temporary dip in prices, but as the economy recovered and food prices accelerated, the country returned to a 6% inflation rate in mid-2021,” UNCTAD said in its latest Trade and Development Report.
UNCTAD said, the Indian economy, which contracted 7% in 2020, grew 1.9% in the first quarter 2021, led by the momentum of the second half of 2020 and supported by government spending on goods and services.
“Meanwhile, a severe and broadly unanticipated second wave of the pandemic, compounded by bottlenecks in vaccine rollout, hit the country in the second quarter, on top of rising food and general price inflation, forcing widespread lockdowns and drastic consumption and investment adjustments,” it added.

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