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ADB sees India grow by 11%, adds caveat

-The Hindu

Lender sees ‘considerable downside risk’ from latest COVID wave, says may revise forecast in July

The Asian Development Bank has raised its forecast for India’s growth in 2021-22 to 11%, from 8% earlier, even as it warned that failure to control the resurgence of COVID-19 cases including April’s exponential jump poses a “considerable downside risk to the recovery”.

‘Targeted containment’

In its assessment based on end-March data, the ADB cited this year’s ‘more targeted’ containment measures compared with last year’s ‘large-scale’ national lockdown and said these would prove ‘less costly’ to the economy, which had seen a strong rebound in recent months’ economic indicators after last year’s ‘big recession’.

“A stimulus-fuelled surge in the U.S., India’s largest export market, will support the revival, but a severe second COVID-19 wave is threatening the recovery,” the lender said in its Asian Development Outlook report, projecting growth to moderate to 7% in 2022-23, after a 11% expansion this year. Government capex and accommodative financial policies, along with the vaccine roll-out programme this year, would also help, it added.

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