It has been over a month that India’s 1.3 billion population has been under a nationwide lockdown imposed by the Modi government to curb the spread of Coronavirus pandemic. Owing to the temporary closure of businesses and manufacturing in Asia’s third-largest economy, the country’s production output recorded an all-time low at 27.4 in April, according to the PMI (Purchasing Managers’ Index) data compiled by IHS Markit. As per the data released on Monday, there was an unprecedented contradiction in Indian manufacturing output in April as compared to 51.8 PMI in March. Furthermore, business operations across the sector observed the sharpest deterioration in over 15 years since the data collection began.
The survey pointed out that demands were severely hampered and supply was disrupted across the manufacturing sector. There was an input price drop due to the weakening of demand among manufacturers, which has been notably the quickest decline rate in years. The survey analyses output, jobs, suppliers’ delivery time, stock of purchases, and new orders for around 400 manufacturers. While a figure above 50 shows expansion, a sub-50 projects contraction.
Amid the fight against increasing infected cases, India is grappling with economic fallout due to the COVID-19 pandemic. There is no doubt that the pandemic shutdown has taken a huge toll on business, manufacturing, and economy across the nation. Not only there is a turmoil in production activity, but there have been mass job losses and unemployment across the country.
Sectors such as retail, automobile, electronics and IT are some of the worst-hit due to restrictions. Due to disruption in economic activities, experts are projecting India’s Gross Domestic Product to contract in the FY21. Moody’s has recently projected India’s economic growth at 0.2% in 2020, expecting it to rebound to 6.2% next year.
Meanwhile, the lockdown has extended by the government until May 17. As the Centre begins to easing the lockdown restrictions through zones, the Commerce and Industry Ministry is also working on a strategy in order mitigate the economic ramifications of the global health crisis. Discussions are taking place between the government and industry stakeholders over a staggered restart of business activities. Several manufacturing companies such as auto, chemicals and textiles have already resumed their production operations after getting a nod from the state governments.
So far, the country has recorded more than 46,000 Coronavirus positive cases and more than 1500 people have died due to the deadly disease.
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