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New Delhi, May 27: India’s fourth recession since Independence, first since liberalisation, and perhaps the worst to date is here, according to rating agency, Crisil.

CRISIL sees the Indian economy shrinking 5 per cent in fiscal 2021 (on-year), because of the Covid-19 pandemic. The first quarter will suffer a staggering 25 per cent contraction.

About 10 per cent of gross domestic product (GDP) in real terms could be permanently lost. "So going back to the growth rates seen before the pandemic is unlikely in the next three fiscals", Crisil said.

Crisil has revised its earlier forecast downwards. "Earlier, on April 28, we had slashed our prediction to 1.8 per cent growth from 3.5 per cent growth. Things have only gone downhill since", it said.

While we expect non-agricultural GDP to contract 6 per cent, agriculture could cushion the blow by growing at 2.5 per cent.

In the past 69 years, India has seen a recession only thrice as per available data in fiscals 1958, 1966 and 1980. The reason was the same each time a monsoon shock that hit agriculture, then a sizeable part of the economy.

"The recession staring at us today is different," it added. For one, agriculture could soften the blow this time by growing near its trend rate, assuming a normal monsoon. Two, the pandemic-induced lockdowns have affected most non-agriculture sectors. And three, the global disruption has upended whatever opportunities India had on the exports front.

Economic conditions have slid precipitously since the April-end forecast of 1.8 per cent GDP growth for fiscal 2021 (baseline), Crisil said.

On the lockdown extension, it said that the government has extended the lockdown four times to deal with the rising number of cases, curtailing economic activity severely (lockdown 4.0 is ending on May 31).

The first quarter of this fiscal will be the worst affected. June is unlikely to see major relaxations as the Covid-19 affliction curve is yet to flatten in India.

"Not only will the first quarter be a washout for the non-agricultural economy, services such as education, and travel and tourism among others, could continue to see a big hit in the quarters to come. Jobs and incomes will see extended losses as these sectors are large employers," Crisil said.

CRISIL also foresees economic activity in states with high Covid-19 cases to suffer prolonged disruption as restrictions could continue longer.

A rough estimate based on a sample of eight states, which contribute over half of India's GDP, shows that their 'red zones' (as per lockdown 3.0) contributed 42 per cent to the state GDP on average regardless of the share of such red zones.

On average, the orange zones contribute 46 per cent, while the green zones where activity is allowed to be close to normal contribute only 12 per cent to state GDP.

The economic costs are higher than earlier expectations, according to Crisil. The economic costs now beginning to show up in the hard numbers are far worse than initial expectations.

Industrial production for March fell by over 16%. The purchasing managers indices for the manufacturing and services sectors were at 27.4 and 5.4, respectively, in April, implying extraordinary contraction. That compares with 51.8 and 49.3, respectively, in March.

Exports contracted 60.3 per cent in April, and new telecom subscribers declined 35 per cent, while railway freight movement plunged 35 per cent on-year.

"Indeed, given one of the most stringent lockdowns in the world, April could well be the worst performing month for India this fiscal," it said.

Added to that is the economic package without enough muscle. The government recently announced a Rs 20.9 lakh crore economic relief package to support the economy. The package has some short-term measures to cushion the economy, but sets its sights majorly on reforms, most of which will have payoffs only over the medium term.

"We estimate the fiscal cost of this package at 1.2 per cent of GDP, which is lower than what we had assumed in our earlier estimate (when we foresaw a growth in GDP)," it said.

"We believe a catch-up to the pre-crisis trend level of GDP growth will not be possible in the next three fiscals despite policy support. Under the base case, we estimate a 10 per cent permanent loss to real GDP (from the decadal-trend level), assuming average growth of about 7 per cent between fiscals 2022 and 2024," Crisil said.

Interestingly, after the Global Financial Crisis (GFC), a sharp growth spurt helped catch up with the trend within two years. GDP grew 8.2 per cent on average in the two fiscals following the GFC. Massive fiscal spending, monetary easing and swift global recovery played a role in a V-shaped recovery.

To catch-up would require average GDP growth to surge to 11 per cent over the next three fiscals, something that has never happened before.

The research said that successive lockdowns have a non-linear and multiplicative effect on the economy a two-month lockdown will be more than twice as debilitating as a one-month imposition, as buffers keep eroding.

Partial relaxations continue to be a hindrance to supply chains, transportation and logistics. Hence, unless the entire supply chain is unlocked, the impact of improved economic activity will be subdued.

Therefore, despite the stringency of lockdown easing a tad in the third and the fourth phases, their negative impact on GDP is expected to massively outweigh the benefits from mild fiscal support and low crude oil prices, especially in the April-June quarter. "Consequently, we expect the current quarter's GDP to shrink 25 per cent on-year," it said.

Counting lockdown 4.0, Indians have had 68 days of confinement. S&P Global estimates that one month of lockdown shaves 3 per cent off annual GDP on average across Asia-Pacific.

Since India's lockdown has been the most stringent in Asia, the impact on economic growth will be correspondingly larger.

Google's Community Mobility Reports show a sharp fall in movement of people to places of recreation, retail shops, public transport and workplace travel. While data for May shows some improvement in India, mobility trends are much below the average or baseline, and lower compared with countries such as the US, South Korea, Brazil and Indonesia.

New Delhi, Jul 22: With a spike of 37,724 cases and 648 deaths reported in the last 24 hours, the total number of COVID-19 cases in India stands at 11,92,915, according to the Union Ministry of Health and Family Welfare.

The total number of cases includes 4,11,133 active cases, 7,53,050 cured/discharged/migrated and 28,732 deaths, the Health Ministry informed.

Maharashtra remains the worst affected state with 3,27,031 cases and 12,276 deaths.
The second worst-hit state, Tamil Nadu has reported 1,80,643 COVID-19 cases so far while Delhi has reported 1,25,096 cases, according to the Ministry.

Other states that have witnessed a higher number of COVID-19 positive cases include, Andhra Pradesh with 58,668 cases, Karnataka with 71,069 while Telangana has reported 47,705 COVID-19 positive cases.

Meanwhile, as per the information provided by the Indian Council of Medical Research (ICMR), the total number of samples tested up to July 21 is 1,47,24, 546 including 3,43,243 samples tested yesterday.

New Delhi, Jan 29: Badminton champion Saina Nehwal joined the ruling BJP today and is likely to campaign for the party ahead of the February 8 Delhi election.

"I have won medals for the country. I am a very hardworking and I love hardworking persons. I can see Prime Minister Narendra Modi does so much for the country, I want to do something for the country with him," the shuttler said, wearing the BJP scarf.

"I draw a lot of inspiration from Narendra sir".

Haryana-born Saina Nehwal, 29, is a major acquisition for the party in the middle of the Delhi poll campaign; she is one of the most popular sportspersons in India with a huge fan following and brand value. She is preparing for the 2020 Tokyo Olympics.

A former world number 1, she has been honoured with the country's top sporting awards like the Rajiv Gandhi Khel Ratna and Arjuna Award. She was also awarded the Padma Bhushan in 2016.

The Badminton player has won over 24 international titles. In the London Olympics, she won a bronze. She was world number two in 2009 and number one in 2015.

With her tweets praising Prime Minister Narendra Modi, Saina Nehwal was widely seen to lean towards the BJP.

One of her tweets became controversial when it was found to be identical to several others in praise of a PM Modi speech last year. Saina was trolled on Twitter with screenshots of the identical tweets. She was also among the sportswomen who put up identical tweets on Diwali thanking PM Modi for his initiative to empower women, with the hashtag #bharatkilaxmi.

The BJP roped in many famous personalities last year, including cricketer Gautam Gambhir, who was elected MP from Delhi in the national election, and wrestler Babita Phogat. Just before the Haryana assembly polls, the party roped in wrestler Sushil Kumar, Babita Phogat and former Hockey team captain Sandeep Singh. Sandeep Singh won the election and was appointed minister.