(Adds details; paragraphs 3,5,7,8)
NEW DELHI, Sept 8 (Reuters) - India's economy is projected to contract 11.8% on the year in the current fiscal year beginning from April, before bouncing back in the next fiscal year, India Ratings and Research, a domestic arm of ratings agency Fitch, said on Tuesday.
"All indicators, be it mobility or consumption, are pointing towards a much weaker economic recovery," Sunil Kumar Sinha, its principal economist told an online conference.
The economy is projected to contract 11.9% in the current quarter, followed by a contraction of 6.7% in the December quarter and 5.4% in the subsequent quarter, Sinha said, citing the adverse impact of coronavirus pandemic.
Earlier, India Ratings had projected the economy would contract 5.3% in the current fiscal year, versus growth of 4.2% in the previous year.
While a second wave of infections sweeps the globe, India has not yet managed to flatten the first wave, he said.
Its economy shrank 23.9% in the quarter from April to June, much more than forecast, in a sign that recovery could be longer than expected, with analysts urging further stimulus. Monday, India surpassed Brazil as the nation with the largest number of infections outside the United States, with a tally of 4.28 million.
India Ratings projected the federal fiscal deficit to rise to 8.2% of GDP, propelled by an economic contraction and greater government spending to mitigate the pandemic effects, versus 4.6% in the previous fiscal year.
Add Chart to Comment
We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:
- Enrich the conversation
- Stay focused and on track. Only post material that’s relevant to the topic being discussed.
- Be respectful. Even negative opinions can be framed positively and diplomatically.
- Use standard writing style. Include punctuation and upper and lower cases.
- NOTE: Spam and/or promotional messages and links within a comment will be removed
- Avoid profanity, slander or personal attacks directed at an author or another user.
- Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
- Only English comments will be allowed.
Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.