“The world economy will go into recession this year with a predicted loss of global income in trillions of dollars. This will spell serious trouble for developing countries, with the likely exception of China and the possible exception of India” UNCTAD said.
Why is India the exception, you may ask?
According to the economic survey in 2018-19, almost 93% of the total workforce in India is informal. Among daily wage workers in the non-agricultural sector, 71.1% had no written job contract and 49.6% of workers had no social security benefits. But according to the RBI, the government imposed restrictions will not affect this informal market.
Let’s contrast this with the US economy.
According to a McKinsey report, the global economy should recover from this crisis by Q3CY22, but USA and Europe are estimated to recover by Q1CY23 and Q3CY23, respectively. In US, jobless claims surged to more 6.6 million this week and Goldman Sachs is now forecasting a real GDP decline of 34% in Q2CY20. The report says that the unemployment rate can rise up to 15%.
As we aim to formalise most of our economy in the coming years, we must bear in mind to “Make in India” and to “Skill India” appropriately, learning from the mistakes of the world.