Calculate the impact of lockdown on the economy of arunachal pradesh
Answers
If the Indian economy were a person, her income in 2020-21 and 2021-22 would be less than what it was in 2019-20. At least, this is what the latest World Bank forecasts tell us. There is enormous, perhaps unprecedented, economic pain ahead. Both policy and politics will have to play an important role to alleviate this. Bad policy can delay, even derail economic revival. Good politics can ensure that the suffering of the masses is minimized. What can be done to ensure this?
A three-part series in these pages looked at the nature of economic challenge facing India in detail. Its main argument was that India needs a demand-side intervention. But Indian economy is both huge and diverse. The policy response will have to be mindful of this diversity. Only then can suitable measures be applied where they are needed. Policy, especially in times of crisis, is also a question of distributing scarce resources among competing needs.
In a democracy, politics influences this process in a big way. This two-part series tries to address these questions. The first part will highlight how the contraction in growth will not be uniform across regions and sectors. The second part will discuss possible avenues of political mobilization.
Earlier this week, the World Bank released its Global Economic Prospects report. It expects India’s gross domestic product (GDP) to contract by 3.2% in 2020-21. There will be a moderate recovery to 3.1% growth in 2021-22. This means that 2021-22 GDP will be less than what it was in 2019-20. To be sure, India is not the only country which will face this predicament. The East Asian region seems to be the only exception. (See Chart 1)