In: hive-exclusives | China
India’s Economy Gets Back on Track
(2 min read)
An ongoing reduction in India’s new daily COVID cases is allowing the economy to slowly return to normal. From a peak of over 400,000 in early May, the daily caseload has eased back to around 120,000, allowing several areas including New Delhi as well as Maharashtra state to begin lifting restrictions. Mobility is improving and continued normalisation should contain the economic disruption to the April-June quarter (Chart 1).
Vaccine rollout remains modest at around just 3.3mn per day, versus 19.4mn in China, leaving India below the world average on a per capita basis. But this is set to improve. Production at India’s Serum Institute is to jump by 40% this month, while Bharat Biotech (which produces the Covaxin vaccine) is also expected to increase production. Faster vaccine rollout should allow the recovery to gain traction, with pent-up demand boosting consumer spending and production disruptions ending.
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