Lockdown of 21-day to shave Rs 40000 crore daily off economy: Care Ratings

Care Ratings in its latest report has said that if the 21-day long national lockdown leads to 80 per cent production loss, the economy will take a hit of Rs 35,000-40,000 crore on a daily basis, shaving off Rs 6.3-7.2 lakh crore cumulatively. The assessment is based on the FY20 real GDP that is Rs 140-150 lakh crore.

It stated that assuming 300 working days in a year, the daily output comes to Rs 45-50,000 crore which can potentially be lost due to the shutdowns. Based on this, Q4 growth may not be negative but can go down to 1.5-2.5 per cent. The economy was slated to grow by Rs 1.74 lakh crore in Q4 or by 4.7 per cent.

Further it said that of the 21 days lockout, 14 days spill over to FY21, therefore potential total loss will be in the region of Rs 6.3-7.2 lakh crore assuming 18 working days will be split across the two years. Besides, it warned that with two-thirds of the impact being passed on to Q1, the GDP loss can be in the region of Rs 4.2- Rs 4.8 lakh crore in FY21. This can potentially lead to a de-growth in GDP in Q1 provided there is no or low growth in the subsequent quarters.