We could go on talking about the effects of COVID-19 on the Indian economy but then that’s something we already know a lot about. Everyone says that this is the time of recession. But experts say that we are in the middle of a ‘technical recession’.
Let’s see how it is different from a regular recession and how it might affect our country. Is it going to be good? Is it going to be bad? Does the common man have anything to worry about?
What Is A Technical Recession?
As a part of the regular bulletin, the Reserve Bank of India has now dedicated a chapter to the state of the economy and started to nowcast or predicting the present or the very near future of the economy.
In it, RBI predicted an 8.6% contraction in the later half of the current financial year. This means that India is in the middle of a technical recession for the first time in its history.
When the real GDP has been in decline and the economy has been significantly declining for more than two quarters, that is when experts consider it a proper recession.
Simply putting it, a technical recession is the usage of certain technical parameters, quarterly GDP in our case, to define a recessionary period. If the recessionary period goes on for long enough, we can shed the word ‘technical’.
Read More: What IMF Has Said About The Indian Economy?
Sounds complex? It isn’t. It’s just a colonial way of confusing us as they have in many different aspects since their rule here.
Does A Common Man Need To Fear It?
Well, we’ve been in the recessionary phase for quite a few months now, and we know that there’s a lot affecting the country at the moment. But, for a common man, the only thing to understand is, things will be costly, jobs will be less and our country is definitely capable of bouncing back provided the right steps are taken.
There is no point in fearing something we cannot control. The best thing to do now would be to save up and hope our jobs remain intact, seeing so many layoffs taking place.
The dip is unusually low and that is probably something we should worry about. Overall, a recession is something that all nations are facing. We’re in it together, and we’ll fight it together!
Image Source: Google Images
Sources: Times of India, Civils Daily, Indian Express
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This post is tagged under: covid 19 india, economic crash, impact of covid 19, indian economy, recessionary phase, reserve bank of india, technical recession
