Impact on GDP of India due to Coronavirus Pandemic.
                     Impact on GDP of India due to 
Coronavirus pandemic
Massive disruption
 The economic impact of the 2019–20 coronavirus 
pandemic in India has been hugely disruptive. World 
Bank and credit rating agencies have downgraded 
India's growth for fiscal year 2021 with the lowest 
figures India has seen in three decades since the 
1990s. India should prepare for a negative growth rate 
in FY21 and that the country would need a ₹720 lakh 
crore (US$10 trillion) stimulus to overcome.
Source: Google Images
Whopping losses
 The Indian economy is expected to lose over 
₹32,000 crore (US$4.5 billion) every day during 
the first 21-days of complete lockdown which was 
declared following the coronavirus outbreak. Under 
complete lockdown less than a quarter of India's 
$2.8 trillion economy is functional. Supply chains 
have been put under stress.
Source: Google Images
Major companies shut
 Major companies in India such as Larsen and Toubro, 
UltraTech Cement, Aditya Birla Group and Tata Motors 
have temporarily suspended or significantly reduced 
operations. Fast-moving consumer goods companies in 
the country have significantly reduced operations and 
are focusing on essentials. Stock markets in India 
posted their worst loses in history on 23 March 2020.
Source: Google Images
Government initiatives
 The Government of India has announced a variety of 
measures to tackle the situation, from food security 
and extra funds for healthcare. The Reserve Bank of 
India also announced a number of measures which 
would make available ₹3,74,000 crore. The World 
Bank and Asian Development Bank have approved 
support to India.
Source: Google Images
GDP suffering
 A severe demand shock which has offset the recovery 
of Indian economy that was visible towards the end of 
2019 and early 2020 has revised Gross Domestic 
Product (GDP) estimates for India downwards by 0.2 
percentage points for the fiscal year 2020 to 4.8 per 
cent and by 0.5 per cent for the fiscal year 2021 to 6 
per cent. 
Source: Google Images
More shocks to the economy
 India has the recent experience of demonetization: a 
sudden, unannounced alteration to our basic 
economic grammar. India’s internal buffers ensured 
that it was not too affected by the financial crisis of 
2008, even if our GDP growth slipped from 8.5 per 
cent to 6.5 per cent. But this time, given the pre-
existing economic slowdown on which the COVID-19 
crisis is acting, the fears are of GDP growth falling 
below 4 per cent is very near.
Source: Google Images
Economy also under lockdown
 Which means an economic effect enduring way 
beyond the lockdown, or the immediate health 
emergency. Demand will suffer as consumers cut 
spending throughout the year, as even McKinsey 
agreed in an assessment on March 16. In the most 
affected sectors, expect higher corporate layoffs and 
bankruptcies throughout 2020, feeding a self-
reinforcing downward spiral. 
Source: Google Images
Hard-hit sectors
 At the sector levels, tourism and travel-related 
industries will be among the hardest hit. Also, the 
Indian movie and entertainment industry has been 
badly hit. IATA warns that COVID-19 could cost global 
air carriers between $63 billion and $113 billion in 
revenue in 2020, and the international film market 
could lose over $5 billion in lower box-office sales.
Source: Google Images
Significant impact inevitable
 Rating agencies, both global and domestic, are 
unanimous that the Covid-19 pandemic will be an 
economic tsunami for India. Even though the country 
may not slip into a recession, unlike the Eurozone, or 
the US that have stronger trade ties to China, analysts 
believe the impact on India’s GDP growth will be 
significant.
Source: Google Images