Fitch Ratings recently revised India's GDP forecast for the current fiscal year 2021-22 from 12.8% to 10%. The revised forecast is based on the assumption that the second wave of COVID-19 infections has peaked, and the overall impact on the economy would be less severe than previously estimated. Here are the implications of Fitch's revised GDP forecast for India -

• The revised forecast is still higher than the IMF and World Bank's estimates, which pegged India's GDP growth for the current fiscal year at 9.5% and 8.3%, respectively.
• Despite the downward revision, India is still projected to be one of the fastest-growing major economies in the world in the post-COVID era.
• The second wave of COVID-19, along with lockdowns and other restrictions, has significantly impacted the economy, particularly the services sector.
• Nevertheless, a rapid vaccination drive and government spending on infrastructure and healthcare could support the economic recovery in the coming months.
• The outlook, however, remains uncertain, and any delay in the vaccination drive or the emergence of new variants of the virus could dampen the recovery prospects.

Overall, Fitch's revised GDP forecast for India reflects the fragility of the economic recovery amidst the ongoing pandemic and the need for continued policy support.