Indian economy heads for double digit plunge as virus spikes
Munawar Zaman
Press TV, New Delhi
The Indian economy is shrouded in the clouds of uncertainty as the COVID-19 pandemic has worsened the already fragile economic prospects of the country.
The country has emerged as a global hotspot for the coronavirus pandemic with more than five million cases. Rating agencies have cut India’s growth forecast by 10 percent or more.
The failure to bring infections under control has impacted business activity and consumption which had been slowly picking up after India eased the world’s biggest lockdown. While a second wave of infection is being seen globally, India is still struggling to flatten the curve of first wave. The economic slowdown has impacted people in a very severe way. Migrants, labors and other informal workers are the hardest hit.
Experts say India must ensure peoples livelihood by direct cash assistance, credit guarantee programs for businesses and fix its financial sector through institutional autonomy and processes to achieve full economic recovery.
Growth forecasts came last week after data suggested India’s GDP plunged 23.9 percent in the April-June quarter from a year ago which is the biggest decline recorded in decades. Experts say the recovery would be gradual depending on how the government handles the intensity of the rising infection.
The pandemic with economic slowdown has devastated the livelihood of millions in India who are being pushed into extreme poverty. The country is also staring at the unemployment crisis with youth being the worst affected.
The pandemic is making the issue even more acute. Sectors such as service, manufacturing, industry, informal sector, retail, tourism, hospitality and auto have been badly hit leaving many without livelihood. The government, however, insists that the country will emerge strong once the lockdown process is eased.
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