Covid-19 impact: India's economy to shrink by 3.2% in FY21, says World Bank

India to lose tag of fastest growing large economy to China for another two years

World Bank on Monday sharply scaled down its projections for India’s economy, forecasting 3.2 per cent contraction in the fiscal year 2020-21 because of the Covid-induced lockdown. It had earlier predicted 1.5-2.8 per cent growth.

The country's economy grew 4.2 per cent in 2019-20, the slowest in 11 years. 

“Stringent measures to restrict the spread of the virus, which heavily curtail short-term activity, will 

contribute to the contraction,” World Bank said in its latest edition of the Global Economic Prospect.

It, however, stressed India’s economy should bounce back in 2021-22 and pegged growth at 3.1 per cent. Still, it is lower than 4-5 per