COVID-19 and Its Impact on the Indian Economy

ABSTRACT

Pessimism looms large all over. COVID-19 has been projected as worse than the Great Depression of 1930. Everyday analyst and agency reports are diving into new bottoms of a fall-down in economic activities. Indian economy, however, has a slightly different story to tell at this hour of crisis. The silver lining for the Indian economy comes from a steep fall in the crude oil prices from around $70 per barrel to a record 18 years low of $22 per barrel. This windfall gain can, to some extent, offset the direct losses due to COVID-19. At the same time, dreams like a $5 trillion economy no longer look even a remote possibility. This article takes stock of the likely impact of COVID-19 on the Indian economy in the short term and the long term. A decision-tree approach has been adopted for doing the projections.