NEW DELHI: According to India Ratings and Research (Ind-Ra), the rising incidences of the Omicron variant of Covid-19, as well as the ensuing bans, will have a negative influence on India's Q4FY22 GDP .
As a result of the increased number of incidents, state governments have implemented a series of restrictions, including market capacity reductions and night and weekend curfews to limit human mobility. According to Ind-estimations, Ra's GDP growth in Q4FY22 will be 5.7 percent year-on-year (YoY), down 40 basis points from the agency's previous forecast of 6.1 percent.
"For the entire FY22," the agency said, "the GDP is forecast to increase at a rate of 9.3 percent YoY, down 10 basis points from our earlier estimate of 9.4 percent."
Despite the fact that Omicron cases are spreading far quicker than earlier Covid variants, early signs suggest that the infections are milder and, in most cases, not life threatening.
As a result, state-imposed restrictions will be less disruptive than Covid 1.0 and 2.0. Furthermore, the previous two waves have equipped both government and industry to deal with and be more resilient in such situations. Policy support - both monetary and fiscal - will be crucial, according to the agency, until the pandemic threat subsides and the economy resumes a sustainable growth trajectory.