The Ministry of Finance’s June macroeconomic report has hinted at the possibility of the domestic economic growth contracting by 4.5 % in the current fiscal year. The Ministry, in its report, has attributed the shrinkage to the ongoing pandemic, and added that its report is in line with the predictions of IMF.
The COVID-19 pandemic has taken a huge toll on India’s economy, which was already sluggish before the contagion began. With manufacturing activities being adversely affected due to the pandemic-induced lockdowns in most states, the GDP of the country is bound to suffer. In fact, the entire global economic growth is on a downward trend in the aftermath of the contagion.
The financial markets have witnessed some of the worst losses due to the pandemic. Many economists are of the opinion that it will talk a long time before the domestic economy returns to its pre-COVID potential.