Countryside may help ease India’s economic downturn

Significance

Many urban firms are suffering labour shortages, as the nationwide lockdown forced millions of migrant labourers to leave the cities in which they were working and return to their homes in rural areas.

Impacts

• GDP will likely contract heavily in fiscal year 2020/21 (April-March).
• Since ‘normal’ monsoon rainfall is forecast, there should be sizeable harvests this year, increasing the likelihood of agricultural growth.
• As COVID-19 cases continue to rise, health services in many cities could become overwhelmed.