India’s economy is expected to grow the fastest, at 6.7%, in 2022, followed by China even though its growth will be faster in 2021, the United Nations Conference on Trade and Development said on Wednesday. In its Trade and Development Report 2021, UNCTAD said that India’s economy is expected to grow 7.2% in 2021, the second highest in the world after China but the growth will slowdown to 6.7% in 2022.
It also said that the reluctance of other advanced economies to follow the lead of the US on the vaccine waiver is a worrying sign and a costly one. India’s growth comes amid a 5.3% projection for global growth, its fastest rate in nearly five decades. This is seen decelerating to 3.6% in 2022.
UNCTAD noted that a severe and broadly unanticipated second wave of the pandemic, compounded by bottlenecks in the vaccine roll out, hit the country in the second quarter, on top of rising food and general price inflation, forcing widespread lockdowns and drastic consumption and investment adjustments.
Going forward, assuming away a resurgence of the pandemic to the degree experienced in the second wave, it said private sector activity revitalisation, subject still to a slow recovery of jobs, is likely to be matched with a more adverse policy environment, especially on the fiscal front, and with continuing pressures on the trade balance.
“On these conditions, the economy is expected to decelerate to 6.7% growth in 2022,” it said.
Supporting the Trade-Related Aspects of Intellectual Property Rights agreement waiver proposal for vaccines, therapeutics and diagnostics at the World Trade Organization, UNCTAD said that this is “a necessary first step to enabling the local manufacture of vaccines” but it has been resisted by other advanced economies, whose defence of large corporate interests is causing new fissures in the global economy, based on access to vaccines and freedom of movement despite belated backing from the US.