Although the headline growth in 2021–22 and the projections for 2022–23 following the disastrous COVID-19 pandemic are impressive, indeed the highest among major economies, this is not the hoped-for V-shaped recovery as the output loss is far from being recouped. India’s output loss is among the highest in major G20 economies. It may be difficult for the Indian economy to sustain an average growth above 5% in a business-as-usual scenario because its potential growth has declined through hysteresis, and it faces several headwinds going forward.
