The business resumption index created by Nomura shows that India's economic recovery has slumped for all of July after recovering significantly in June amid the coronavirus pandemic.
This isn't surprising as India’s total COVID-19 cases are seeing the biggest single day increase over the last five days. To be sure, the COVID-19 recovery rates are also rising, but there are two reasons why a high COVID recovery rate is not converting into a high economic recovery rate: one, many new and smaller states are seeing a surge in COVID1-19 cases; and two, many city municipal corporations and state governments are going back into lockdown.
In the past week Pune, Pimpri, Chinchwad, Aurangabad, Bengaluru, parts of Chennai, Kolkata and several areas of Assam, Bihar and Madhya Pradesh have gone into lockdown for a second time, even as many areas in Mumbai and Delhi have remained under lockdown since end-March.
Aurodeep Nandi, the author of the Nomura Index, Mahesh Vyas of CMIE whose labour participation index is a part of the Nomura Index, and Sudipto Mundle of the 14th finance commission discussed more about the early flattening of the economic recovery curve but the non-flattening of the COVID-19 curve.