GDP: According to the Indian analytical company Crisil Research, the coronavirus pandemic could lead to a permanent 4 per cent loss in the country’s Gross Domestic Product (GDP).
Even though the economy will eventually recover in many ways, this four per cent loss could be permanent, the research suggests.
India grew at 4.7 per cent in the third quarter of 2019-’20 but this growth was before the COVID-19 crisis. Now in 2020, the GDP of the country may go towards 0 if the lockdown is extended in the country making India suffer unprecedented economic losses.
Chief Economist at Crisil, Dharmakirti Joshi compared this crisis with the Global Financial Crisis of 2008. The crisis of 2008, until now, is seen as the benchmark of economic fallout but this COVID-19 crisis is way too damaging for the Indian economy. As the economy is not expected to recover for the next three years.
However, if the GDP grows at an average rate of 8.5 per cent every year up to 2023, India can recover completely. But the chances for such exponential growth in the GDP is very low as the return of normalcy post-COVID-19 is quite impossible.
Crisil calls it inadequate. As at present, at least Rs 3.5 lakh crore of stimulus is required but in reality, it counts up to Rs 1.7 lakh crores.
When the revival happens it will take a different shape and different time for the recovery. Sectors like FMCG and Telecom are mildly affected and they can recover quickly. Sectors like transportation require moderate revival, while sectors aviation, hospitality, and media are adversely affected and they will take a long time to grow and flourish.