The Reserve Bank of India (RBI) in its latest report said India was one of the worst-hit nations during the Covid-19 pandemic and that it will take up to 13 years for India to fully recover from the scars of the Covid-19 pandemic. India suffered among the biggest pandemic induced losses in the world in terms of output, lives and livelihoods, which may take years to recover. Economic activity has barely recovered to pre-COVID levels even after two years.
- The pre-COVID trend growth rate works out to 6.6 per cent (CAGR for 2012-13 to 2019-20) and excluding the slowdown years it works out to 7.1 per cent (CAGR for 2012-13 to 2016-17).
- Taking the actual growth rate of (-) 6.6 per cent for 2020-21, 8.9 per cent for 2021-22 and assuming a growth rate of 7.2 per cent for 2022-23, and 7.5 per cent beyond that, India is expected to overcome COVID-19 losses in 2034-35.
According to the report:
- The RBI report further added that the pandemic is a watershed moment and the ongoing structural changes catalysed by the pandemic can potentially alter the growth trajectory in the medium-term.
- Sustained thrust on capital expenditure by the government, push to digitalisation and growing opportunities for new investment in areas like e-commerce, start-ups, renewables and supply chain logistics could in turn, contribute to step up the trend growth while closing the formal-informal gap in the economy.