India GDP Shrinks 23.9% in Q1; Know How Long Will be The Struggle
India’s GDP growth contracted by record 23.9 percent in the first quarter of the ongoing fiscal year (2020-21). This is the worst fall of the Indian economy since 1996. In Asia too, India’s 23.9 percent GDP shrink is the worst.
The reason behind this fall is the strict lockdowns imposed throughout the nation to contain the spread of the coronavirus since March. While the shutdowns helped India reduce the chances of COVID-19 infection, the virus hit the country’s economy hard as many reported massive losses in jobs and businesses.
In the previous quarter, India’s GDP had registered an expansion of 3.1 percent, while the first quarter of the last fiscal year had recorded a 5.2 percent growth.
Now, the question is, how long will be the struggle?
According to the experts, India is hoping for a V-shaped recovery to come out of this crisis. The V-shaped recovery means that the fallen economy will rise back as quickly as it had descended. But for that, the government will have to provide the necessary boost to increase the demand.
When the demand rises, the households spend high and companies hire more employees to meet the rising demand and thus the income rises as well.
However, those who feel a V-shaped recovery will be a miracle in the time of coronavirus rather predict an L-shaped slide. This slide in economy is also known as ‘hockey stick’ slump as it means a period when the growth stops and the stagnancy stays for a long time.
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