Moody's Investors Service sees India's economic growth at zero' in FY21
Mumbai: Moody's Investors Service on Friday said it estimates India's GDP growth to hit zero' in FY21 and pointed to a wide fiscal deficit, high government debt, weak social and physical infrastructure, and a fragile financial sector.
The quality of India's economic growth has declined in recent years, demonstrated by financial stress among rural households, relatively low productivity and weak job creation, the agency said.
In its forecast for FY21, the agency estimated India's gross domestic product (GDP) growth at zero, meaning the country's economic growth will remain flat this financial year, and the same is seen accelerating to 6.6 per cent in FY22.
In its credit opinion which comes following the change in the forecast, Moody's warned that the COVID-19 "shock will exacerbate an already material slowdown in economic growth, which has significantly reduced prospects for durable fiscal consolidation".
Analysts across the board have been certain about the heavy economic toll that the pandemic will take on the country.
Moody's local arm Icra has pegged for a contraction of up to 2 per cent in the growth as a result of the crisis, which has seen the country being put under a lockdown for nearly two months to arrest the spread of infections.
Late last month, Moody's had slashed its calendar year 2020 GDP growth forecast to 0.2 per cent.
Its negative outlook on the sovereign rating, which was revised last in November 2019 from stable', reflects increasing risks that economic growth will remain significantly lower than in the past, it said, adding that this takes into account the deep shock triggered by the virus outbreak.
Meanwhile, India's credit strengths include a large and diverse economy, favourable demographic potential and a stable domestic financing base to fund the government debt, it noted.
In March, the government had announced a relief package worth Rs 1.7 lakh crore, and there are speculations of another follow-up package in the offing.
These measures will reduce the depth and duration of India's growth slowdown, but there is a probability of an "entrenched weakening" on prolonged financial stress among rural households, weak job creation and a credit crunch among non-bank financial institutions, it said.
Reform prospects, which can take care of some of the concerns with the Indian economy, have "diminished", the agency said.
It further warned that a downgrade in the rating could happen if the fiscal metrics weakened materially, and made it clear that a "negative" outlook indicates that an upgrade in the rating is unlikely in the near term.
However, the outlook can be changed to "stable" if the fiscal metrics stabilise, it added.
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House of BJP Minority Morcha's Manipur president torched for supporting Waqf Amendment Act
Imphal, Apr 6 (PTI): The house of the BJP Minority Morcha's Manipur president, Asker Ali, was set on fire by a mob on Sunday night allegedly for supporting the Waqf Amendment Act, officials said.
The incident happened at Lilong in Thoubal district, they said.
Ali had expressed his support for the Act on social media on Saturday.
An irate mob gathered outside his residence around 9 pm, vandalised it and later set it on fire, officials said.
Following the incident, Ali posted a video on social media, apologising for his earlier statement. He also expressed opposition to the Act.
Earlier in the day, protests were held in different parts of Imphal Valley against the Act.
Over 5,000 people participated in a rally that disrupted the traffic on NH 102 at Lilong.
In some places, the protesters got engaged in a scuffle with the security forces, officials said.
One such incident happened at Irong Chesaba in Thoubal in the morning. The scuffle broke out after the demonstrators were stopped by the security forces from moving forward.
The demonstrators raised slogans against the BJP-led government at the Centre, decrying the Act.
"The Waqf Amendment Act is against the ethos of the Constitution. It is completely unacceptable for the Muslim community," said Sakir Ahmed, a protester.
Protests were also held in Kshatri Awang Leikai, Kairang Muslim and Kiyamgei Muslim areas in Imphal East, and Sora in Thoubal district, among other places.
Security has been strengthened in Muslim-dominated areas of the Valley, with additional forces deployed, officials said.
The Waqf (Amendment) Bill was passed by the Lok Sabha on Thursday, and by the Rajya Sabha in the early hours of Friday after marathon debates in both Houses of Parliament.
The Act aims to streamline the management of Waqf properties (assets permanently donated by Muslims for religious or charitable purposes) with provisions to safeguard heritage sites and promote social welfare. It also seeks to improve governance by enhancing transparency in property management, streamlining coordination between Waqf boards and local authorities and protecting stakeholders’ rights.
President Droupadi Murmu gave her assent to the bill on Saturday.
Breaking:
— Dr. Lamtinthang Haokip (@DrLamtinthangHk) April 6, 2025
An angry mob of Lilong set fire to the house of @BJPManipur Minority Morcha President, Mr. Askar Ali Mkm for insulting fellow community & supporting the recently passed Waqf (Amendment) Bill, 2025. @rashtrapatibhvn @INCIndia @INCMinority @INCAdivasi @the_hindu… pic.twitter.com/PINixnXGma
