Making India Easy  ·  03. May 2020

India Macro-economic Impact due to COVID-19

India Macro Economics: Real GDP Growth Trend

Real GDP Growth Trend (in %, constant 2011-12 prices)
  • India witnessed a slow down in Real GDP growth rate during last fiscal year over the last 4-5 years due to slow down liquidity crunch and slowdown in private consumption and exports 
  • With the spread of COVID-19 globally including India, resulting into country wide lockdown (from 21 st March to 03rd May) has resulted in halt in the economic activity in India excluding few sectors (FMCG, Healthcare etc.)
  • COVID-19 impact is expected to further slowdown the private consumption and external trade and investment for first half of FY21. 
Note: FY: Fiscal Year: In India FY period is from 1st April of a year till 31st March of the 
subsequent year
Source: Trade Press, RBI, MoSPI, UN Report, Tecnova Analysis, KPMG Report

India Macro Economics: GDP Growth Forecast with COVID-19 Impact 

India GDP Growth Forecast (in %, Y-o-Y)- FY21 

Indian GDP forecast witnessed a revised forecast with downward trend owing to the lockdown for 44 days due to COVID-19 pandemic 

Global GDP Growth Forecast (in %, Y-o-Y)- FY21  
Note: FY: Fiscal Year: In India FY period is from 1st April of a year till 31st March of the 
subsequent year
Source: Trade Press, RBI, MoSPI, UN Report, Tecnova Analysis, KPMG Report, BCG Report

India Macro Economics: COVID-19 Impact Scenario Analysis

COVID-19 Impact on India Economy: Scenario Analysis  
Note: FY: Fiscal Year: In India FY period is from 1st April of a year till 31st March of the 
subsequent year
Source: Trade Press, RBI, MoSPI, UN Report, Tecnova Analysis, KPMG Report

India Macro Economics: Demand Side Impact

India: Private Consumption in FY19
  • Discretionary consumption industries such as restaurants, recreation and culture etc. would be impacted 
  • With extension in lockdown till 3rd May 2020, it is expected to have a severe impact on supply chain and transport industry
  • However, GoI is focusing on re- opening the economy in a planned and structured manner from 20th April onwards with all precautions and SOPs in place in order to contain COVID-19 sprea
  • Abrupt stop in urban activity will hamper the private Consumption of non-essential goods thus slowing down the economic growth (Pvt. Consumption accounts for major share in GDP in India) 
Note: The above % share is – as % of total private consumption expenditure in domestic market;
GoI: Govt. of India
Source: Company Website, Trade Press, First revised estimates of national income, consumption expenditure, savings and capital formation, Ministry of Statistics and Programme Implementation (MoSPI) - 31st Jan 2020

India Macro Economics: Supply Side Impact

India: Imports by Major Countries and % Share – FY19
  • Among COVID-19 impacted nations China and USA are the largest import source for India 
  • While disruption in China would impact Indian industries, the economy will relatively be insulated as it has low reliance on intermediate goods from China and high stockpiling by Indian firms as industry practice
India: Major Commodities Imported from China – FY19

 

Foreign Value Added Component as % of Gross Manufacturing Exports 
Note: The above list is non-exhaustive and in WIP. The final list will be updated in 
subsequent updated  
Source: Export Import Data Bank – DGFT, Dept. of Commerce.. Trade Press, OECD, 
Tecnova Analysis

India Macro Economics: Sector-wise Workforce Distribution

India: Sector-wise Workforce Distribution – FY19 – in # of Workers in Mn
Government Initiatives to Mitigate 
COVID-19 Impact 
Note: The above % share is – as % of total private consumption expenditure in domestic market
Source: Company Website, Trade Press, First revised estimates of national income, consumption expenditure, savings and capital formation, Ministry of Statistics and Programme Implementation (MoSPI) - 31st Jan 2020

 

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