Pandemic impact on economy may linger for years, says RBI

New Delhi, April 30

India has been one of the worst-hit nations from the Covid pandemic and it will take up to 13 years for its economy to fully recover from its scars, says a report of the Reserve Bank of India (RBI).

Recovery by FY35

India among the biggest sufferer of the pandemic in terms of economic setback. It is expected to overcome losses by 2034-35. RBI report

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“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,” noted the report on currency and finance 2021-22, titled “Revive & Construct”.

The pre-Covid growth rate from 2012 to 2020 was 6.6 per cent. Excluding the two slowdown years of 2017-19, the growth rate was 7.1 per cent. Taking the actual growth rate of (-) 6.6 per cent for 2020-21, 8.9 per cent for 2021-22 and assuming growth rate of 7.2 per cent for 2022-23, and 7.5 per cent beyond that, India is expected to overcome Covid losses by 2034-35, it added.

The pandemic will go down in history as one of the worst health crises the world has ever faced. Its economic impact may linger for many more years and pose challenges of rebuilding livelihoods, safeguarding businesses and reviving the economy, it observed.