Prime Minister, on Tuesday, declared in a televised statement that the lockdown in entire India will be extended till 3 May.
New Delhi: The lockdown, which has now been extended till May 3 with caveats, Barclays has pegged the economic cost of it at $234.4 billion, assuming that India will remain under partial lockdown at least till May-end.
This cost is almost 8.1% of gross domestic product or GDP.
While COVID-19 pandemic outbreak in India has not officially entered the 3rd stage or community transmission stage, analysts at Barclay’s believe the existing restrictions on movement are causing way more economic cost than anticipated.
Rahul Bajoria, chief India economist at Barclays, in a recent co-authored report with Shreya Sodhani wrote, “The negative impact of the shutdown measures on the mining, agriculture, manufacturing and utility sectors appears higher than we had expected. Combined with the disruption in several service sectors, we now estimate that the economic loss will be close to 8.1 per cent of GDP.”
ALso Read: Economic Survey pegs economic growth at 7 percent for FY20
Prime Minister, on Tuesday, declared in a televised statement that the national lockdown to contain the spread of the COVID-19 pandemic would continue till May 3.
Following this, Barclays has revised down their GDP growth forecast further to 0 per cent for calendar year 2020 (CY20) from 2.5 per cent earlier, and to 0.8 per cent for FY20-21 (from 3.5 per cent earlier).
CY21 GDP growth forecast, too, has been slashed to 7.5 per cent from 8 per cent earlier. Barclays also suspect a more vulnerable profile for recovery given the deteriorating global situation, and rising risk of COVID-19 outbreaks leading to local-level shutdowns.
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