Indian economy is seen to revive quicker than expected; S&P latest to revise GDP forecast

The S&P Global Ratings has revised its forecast for India's Gross Domestic Products (GDP) for current financial year FY21. The rating agency expects the Indian economy to contract to 7.7% this fiscal.

S&P is optimistic on the Indian economy, as the forecast is better compared to the previous degrowth of 9%.

In its statement, S&P said, rising demand and falling infection rates have tempered our expectation of COVID's hit on the Indian economy.

S&P Global Ratings Asia-Pacific chief economist Shaun Roache stated that it  is no surprise that India is following the path of most economies across Asia-Pacific in experiencing a faster-than-expected recovery in manufacturing production.

Earlier this month,  Fitch Ratings revised India's GDP forecast to (-)9.4% for the current financial year, compared to a contraction of 10.5% which was projected previously.

India's GDP at the constant price in Q2FY21 is estimated at Rs33.14 lakh cr against Rs35.84 lakh cr compared to the same period of last year. In percentage terms, GDP stood at a contraction of 7.5% in Q2FY21 against the growth of 4.4% in Q2FY20. In the June 2020 quarter, the GDP contracted to 23.4%.