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Box 4.1: Global Economic Outlook
Country World GDP (%) Global growth: strong but uneven recovery.
Growth The global economy is set to expand 5.6 percent
Advanced Economies US Projection 2021 in 2021. Although global economic activity has
UK gained significant momentum, it remains well
Euro area 5.6 below pre-pandemic projections. Furthermore,
Japan this recovery is uneven and largely reflects
6.8 sharp rebounds in some major economies—most
notably the United States, owing to substantial
4.2 fiscal support—amid highly unequal vaccine
2.9 access at the global level. In many emerging
market and developing economies (EMDEs),
elevated COVID-19 caseloads, obstacles to
vaccination, and a partial withdrawal of
macroeconomic support are offsetting some of
the benefits of strengthening external demand
and elevated commodity prices.
Emerging Market Advanced economies: strong rebound. Activity
Economies among advanced economies has been propelled
so far this year by a solid recovery in the United
Brazil 4.5 States, partly because of large fiscal support.
Russia Vaccination campaigns are generally proceeding
at a faster pace. Growth in advanced economies
3.2 is forecast to reach 5.4 percent in 2021.
India EMDEs: pandemic weighing on recovery. The
China 8.3 recovery in many EMDEs is being constrained by
South a severe resurgence of new COVID-19 cases and
Africa
8.5 lagging vaccination. The pandemic continues to
Source: World Bank have a particularly dampening effect on tourism
reliant economies and is further exacerbating
domestic challenges in low-income countries.
3.5 Aggregate EMDE growth is forecast to reach 6
percent in 2021, supported by improving external
demand and elevated commodity prices.
Operations, Operation Twist and Government Securities Acquisition Programme (GSAPs).
On top of a liquidity provision of over `13.6 lakh crore in FY21, the RBI has made over `7 lakh
crore additional liquidity provision in FY22 so far. These have resulted in lower borrowing
costs and financial stability across the entire gamut of stakeholders including banks, NBFCs
254 | Annual Report 2020-21
Country World GDP (%) Global growth: strong but uneven recovery.
Growth The global economy is set to expand 5.6 percent
Advanced Economies US Projection 2021 in 2021. Although global economic activity has
UK gained significant momentum, it remains well
Euro area 5.6 below pre-pandemic projections. Furthermore,
Japan this recovery is uneven and largely reflects
6.8 sharp rebounds in some major economies—most
notably the United States, owing to substantial
4.2 fiscal support—amid highly unequal vaccine
2.9 access at the global level. In many emerging
market and developing economies (EMDEs),
elevated COVID-19 caseloads, obstacles to
vaccination, and a partial withdrawal of
macroeconomic support are offsetting some of
the benefits of strengthening external demand
and elevated commodity prices.
Emerging Market Advanced economies: strong rebound. Activity
Economies among advanced economies has been propelled
so far this year by a solid recovery in the United
Brazil 4.5 States, partly because of large fiscal support.
Russia Vaccination campaigns are generally proceeding
at a faster pace. Growth in advanced economies
3.2 is forecast to reach 5.4 percent in 2021.
India EMDEs: pandemic weighing on recovery. The
China 8.3 recovery in many EMDEs is being constrained by
South a severe resurgence of new COVID-19 cases and
Africa
8.5 lagging vaccination. The pandemic continues to
Source: World Bank have a particularly dampening effect on tourism
reliant economies and is further exacerbating
domestic challenges in low-income countries.
3.5 Aggregate EMDE growth is forecast to reach 6
percent in 2021, supported by improving external
demand and elevated commodity prices.
Operations, Operation Twist and Government Securities Acquisition Programme (GSAPs).
On top of a liquidity provision of over `13.6 lakh crore in FY21, the RBI has made over `7 lakh
crore additional liquidity provision in FY22 so far. These have resulted in lower borrowing
costs and financial stability across the entire gamut of stakeholders including banks, NBFCs
254 | Annual Report 2020-21
