Coronavirus Surge Slowing the Growth of the Indian Economy: HSBC

According to HSBC Holdings Plc, restrictions in India due to the Covid-19 surge can lower the economic growth of the country by about a quarter of a percentage point in the current financial year. The HSBC economist, Pranjul Bhandari has said in an interview that the economic cost will be there, but it will be just a third or lower than the previous economic cost.

India is due to release its first official estimate for annual GDP soon. A Bloomberg survey of economists has forecast to show an expansion of 9.3% which is slower than that of the Reserve Bank of India as well as the International Monetary Fund.

Pranjul Bhandari has also said that a rapid rise in cases can lead to deferring the RBI rate hikes for some time, but the central bank would need to take some actions due to the rising price pressures.