India’s economy is estimated to contract by 9.6% in 2020, while it is projected to grow at 7.3% in 2021, a report released by the United Nations Department of Economic and Social Affairs, said on Tuesday.

The report, titled “World Economic Situation and Prospects 2021”, suggested that the global economy shrank by 4.3% last year, which was over 2.5 times more than the contraction during the financial crisis of 2009. The estimated recovery of 4.7% in the global economy in 2021 will barely offset the losses of 2020, the report said.

As for India, the report said that the economy suffered setback as domestic consumption got hit due to to “lockdowns and other containment efforts”, even as the spread of coronavirus could not be halted. It further said that the pandemic affected labour markets in the developing world, with unemployment in India rising to 23% by mid-2020. Taking further note of labour market in south Asia, the report said that informal workers, who account for over 80% of all the workers in Bangladesh, India and Pakistan were “far more exposed” to loss of employment.

India’s growth forecast of 7.3% for the calendar year 2021 is the highest among major economies of the world, according to the report. China will come a close second at 7.2% growth, the UN report said.

Last month, government data for the first advance estimates of this fiscal, projected India’s economy to contract by 7.7% in real terms. However, that projection was for the financial year (April 2020-March 2021), whereas the UN report estimates are for the calendar year (January 2020 - December 2020).

India’s Gross Domestic Product growth rate had contracted by 7.5% in the second quarter (July-September), after shrinking by an unprecedented 23.9% in the first three month period (April-June) of the financial year. The Reserve Bank of India has predicted economy to register positive growth in the third quarter (October-December).