On Friday, Moody's Investors Service slashed its estimate of India's GDP (gross domestic product) growth during the 2020 calendar year to 2.5 percent from an earlier estimate of 5.3 percent, on account of the rising economic cost to curb the spread of coronavirus pandemic.
In 2019, India's growth was at 5 percent.
Moody's said that a sharp fall in incomes in India is likely in 2020, further weighing on domestic demand and the pace of recovery in 2021.
"In India, credit flow to the economy already remains severely hampered because of severe liquidity constraints in the bank and non-bank financial sectors," it said.
The downward projection was made across the globe in the light of the COVID-19 outbreak that has paralysed economic activity everywhere.
Moody's expects the growth in G-20 nation to see an unprecedented shock in the first half of 2020 and contract as a whole, before picking up in 2021.
"We have revised our growth forecasts downward for 2020 as the rising economic costs of the coronavirus shock and the policy responses to combat the downturn are becoming clearer. We now expect G-20 real GDP to contract by 0.5 per cent in 2020, followed by a pickup to 3.2 per cent growth in 2021," it said in the note.
Prior to the outbreak, G-20 growth projection was at 2.6 percent in 2020.