The corona related lockdowns have ensured that the Indian economy has worst numbers to report for the April-May-Jun (AMJ’ 20) quarter.
As per the data published today – the economy has shrunk by 23.9% from a year ago.
The numbers are worst not only in Indian history from 1996 when India stated to report quarterly figures, but also lower than any other major economy in Covid-19 hit Asia.
Meanwhile the virus does not look like slowing down with over 3.5 Million Covid-19 cases, India is fast becoming the corona capital of the world. As close to 1,000 deaths are being reported in the country, fear of stepping out is very real and is almost sure to be the biggest barrier to any recovery economists can hope for.
The country’s economic problems have not started with Covid-19 but have certainly been amplified by it. There needs to be a direct intervention by government to ensure that the country can hold on to the few green shoots and ride on them like a bean stalk, however no such measure seem to be forthcoming.
The red-letter day may also spell doom for Industry – in deep debt to banks. In absence of long orderbooks and delayed collections, industry is finding it ever harder to service its loans to banks.
Finance Minister Nirmala Sitharaman will be meeting the lenders on Thursday to understand restructuring progress and help meet Industry’s expectations.
Meanwhile stock markets seem to be wrapped in a bubble of their own with some stocks hitting 5 year high in the last one quarter period. Even today morning while the media houses were warning of the contraction, Sensex was trading in positive territory with gains above 1% mark.
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