There has been a disruptive economic impact on the Indian Economy. According to the Ministry of Statistics, the fourth quarter of the fiscal year 2020 of Indian growth saw a down to 3.1%. The reason for such a drop in the Indian economy is mainly due to the effect of the Coronavirus pandemic and lockdown; as said by Chief Economic Adviser to the Government of India.
According to the World Bank, the Indian economy was witnessing a slowdown pre-pandemic but the pandemic has worsened the situation of Indian Economy. They say the current pandemic has "magnified pre-existing risks to India's economic outlook". The initially revised statistics of India's growth for FY2021 by the World Bank and rating agencies showed the lowest figures India ever witnessed in the last three decades since India's economic liberalization in the 1990s. India's GDP was downgraded to worsening negative figures when the announcement of the economic package happened in mid- May. It was tending towards a deep recession. This is not just in India but the ratings have been negative for over 30 countries across the globe during this pandemic.
CRISIL announced on 26th May 2020 that it may be India's worst recession since Independence. There was a contraction of over 40% in the GDP in Q1 FY21as the estimation of research by State Bank of India. The contraction will differ as per various parameters such as state and sector and it will not be uniform.
On 1st September 2020, GDP figures were released by the Ministry of Statistics for Q1 (April to June) FY21. It showed a contraction of 24% in comparison with the same period the year before. There is an estimation of 14 crores (140 million) people lost employment during lockdown while salary deductions happened for many others in the nation. There was an income drop for more than 45% of households across the nation as compared with last year's statistics.
By: Kiara Sharma
Mahaveer Public School
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