In response to the second COVID wave, the majority of Indian states imposed state-wide restrictions in May. The wider use of lockdowns is weighing on economic activity and also impacting labour market recovery, further increasing the existing divide across regions, sectors, and sub-industries. However, there are some signs of underlying economic resilience, especially for supply-side indicators than the demand-side. On a positive note, the virus containment efforts seem to be working to taper the number of daily cases, which may allow a gradual relaxation of lockdowns from June onward. As such, we expect the impact of the second COVID wave to be limited to Q1 FY22, followed by a quick rebound in subsequent quarters. We revise our growth projection down to 9.9% YoY for FY22 from 12.4% earlier.
Any statement expressed as recommendation in this Report is general in nature and should be construed strictly as current opinion of DMI as of the date of the Report and may be subject to change from time to time without prior intimation or notice. The readers of this Report should carefully read, understand and investigate or enquire (either with or without professional advisors) into the risks arising out of or attached to taking any decisions based on the information or opinions contained in this Report. DMI or its officers, directors, personnel and employees, including persons involved in the preparation or issuance of this Report may have potential conflict of interest with respect to any recommendation and related information and opinions.
Neither DMI nor any of its officers, directors, personnel and employees shall be liable for any loss, claim, damage of whatsoever any nature, including but not limited to, direct, indirect, punitive, special, exemplary, consequential, as also any loss of profit in any way arising from the use of this Report or the information therein or reliance of opinions contained in this Report, in any manner.
No part of this Report may be duplicated or copied in whole or in part in any form and or redistributed without the prior written consent of DMI. Any reproduction, adaptation, distribution or dissemination of the information available in this Report for commercial purpose or use is strictly prohibited unless prior written authorisation is obtained from DMI. The Report has been prepared in India and the Report shall be subject only to Indian laws. Any foreign reader(s) or foreign recipient(s) of this Report are requested to kindly take note of this fact. Any disputes relating to the Report shall be subject to jurisdiction of Republic of India only.
Read less
