According to a report published by the Reserve Bank of India (RBI), the Indian economy could take more than a decade to recover from the COVID-19 pandemic's losses. The report estimates output losses during the pandemic period to be around Rs 52 lakh crore, based on an analysis of COVID-19's economic impact.
According to the chapter 'Scars of the Pandemic' in the Report on Currency and Finance (RCF) for the year 2021-22, repeated waves of COVID-19 have hampered sustained recovery, and quarterly GDP trends have essentially followed the ebbs and flows of the pandemic.
Following a steep recession in the first quarter of 2020-21, the economy gradually improved until it was slammed by the second wave in April-June 2021-22. Similarly, the third wave's impact, which was focused on January 2022, slowed the healing process.
The downside risks to global and domestic growth are being exacerbated by the ongoing Russia-Ukraine conflict, according to the report, as commodity prices rise and global supply chains are disrupted.
The pre-COVID trend growth rate is 6.6 percent (CAGR from 2012-13 to 2019-20), and it is 7.1 percent excluding the slowdown years (CAGR for 2012-13 to 2016-17). "With an actual growth rate of (-) 6.6 percent for 2020-21, 8.9 percent for 2021-22, and growth rates of 7.2 percent for 2022-23 and 7.5 percent beyond that, India is expected to overcome COVID-19 losses in 2034-35," the report read.
For 2020-21, 2021-22, and 2022-23, the output losses were estimated to be Rs 19.1 lakh crore, Rs 17.1 lakh crore, and Rs 16.4 lakh crore, respectively.