Acuite Ratings sees Q1 growth contracting 5-6 pc on virus woes

Domestic ratings agency Acuite Ratings has forecast a massive 5-6 per cent contraction in growth in the first quarter of the new fiscal due to the coronavirus-driven lockdown.

The agency estimates the daily loss to the economy from the lockdown at around USD 4.6 billion and fears that if at all the countrywide shutdown is lifted on April 14, the risks of a prolonged disruption in economic activities exist depending on the intensity of the outbreak.

"The 21-day lockdown will result in a GDP loss of almost USD 98 billion, pulling down the Q1 growth 5-6 percent," the agency warned, adding that in the best case scenario, growth may limp back into the green territory in Q2.

Accordingly, it expects "the overall GDP growth for FY21 to be 2-3 percent which takes into account a significant economic revival in the second half."