The Indian economy is likely to take over 12 years to overcome the Covid-19 losses, according to a report released by the Reserve Bank of India (RBI) on Friday.
The report has estimated the output losses during the pandemic period at around Rs 52 lakh crore.
The output losses for individual years have been worked out to Rs 19.1 lakh crore, Rs 17.1 lakh crore and Rs 16.4 lakh crore for 2020- 21, 2021-22 and 2022-23, respectively.
"The pandemic is a watershed moment and the ongoing structural changes catalysed by the pandemic can potentially alter the growth trajectory in the medium-term," the report said.
The RBI further noted in the report, that the pre-Covid trend growth rate works out to 6.6 per cent (CAGR for 2012-13 to 2019-20) and excluding the slowdown years, it stands at 7.1 per cent (CAGR for 2012-13 to 2016-17).
"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,” it added.
India is expected to overcome Covid-19 losses in 2034-35," the report said.
The dividends of reforms initiated to counter the pre-Covid slowdown along with additional measures and initiatives during the pandemic will help launch the economy on a sustainable high growth path, it said.
As per the report, the behavioural and technological changes brought about by the pandemic may usher in a new normal which would not necessarily ape the pre-pandemic trends but would be built on a more efficient, equitable, clean and green foundations.
The report noted, "the pandemic is not yet over. A fresh wave of Covid-19 has hit China, South Korea and several parts of Europe. However, various economies are reacting divergently ranging from a no-Covid-19 policy in some jurisdictions on the one hand to those with relatively open borders and removal of internal restrictions. In India, the restriction levels are being dynamically calibrated at local levels in response to the evolving situation."
