06 JUL,2020 | MEDC
A clearer picture is emerging of how the Indian economy is recovering from Covid-19 and the subsequent lockdown. It is borne out by the index of eight core industries announced this week, which contracted by 23.4% in May as opposed to a 37% contraction in April, year-on-year. GST collections are returning to more regular levels, and there is hope that they will rise as backed up returns are announced on the new relaxed schedule announced earlier in the lockdown. Some green shoots of recovery are also becoming visible. For the first time since the global financial crisis of 2008, India saw a current account surplus in the January-March quarter. A relatively comfortable external account gives policymakers some leeway to focus on the internal challenges. However, the Indian economy will have to content itself with the new normal, which is bound to be a decline from the pre-Covid era.
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