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GDP India Expectation FY21Revised: Ind-Ra

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Revised to negative 7.8% from negative 11.8% due to the easing of headwinds!   India Ratings and Research (Ind-Ra) has revised its expectation for India’s FY21 gross domestic product (GDP) growth to negative 7.8% from negative 11.8% due to the easing of the Covid-19 headwinds and better-than-expected 2QFY21 GDP numbers. However, the question remains, how sustainable is the recovery witnessed in 2QFY21, as a significant part of the impetus came from the festival and pent-up demand.   Although the headwinds emanating from Covid-19 related challenges are unlikely to go away till mass vaccination becomes a reality, perhaps the economic agents and economic activities not only have learnt to live with it but also are adjusting swiftly to the post Covid-19 world. Ind-Ra now expects 3QFY21 GDP growth to come in at negative 0.8% and 4QFY21 GDP growth to turn positive at 0.3% as against its earlier expectation it turning positive in 4QFY22. The agency expects FY22 growth to be 9.6%, mainly