- Initial numbers seem to indicate the economy is on the mend as the lockdown lifts, but it is unclear if demand will hold up as unemployment rises
- Movement of goods, which shrank sharply in March and April, picked up in May, in line with the relaxations
NEW DELHI : Traffic congestion, power generation, port activity, vehicle registration and other high-frequency data point to the economy perking up as India reopens, recovering from a devastating slump as factories went idle and people were ordered to stay at home amid the coronavirus pandemic.
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The evidence is tentative, but the economy appears to be gaining some momentum as India emerges from one of the world’s most stringent national lockdowns. It is, however, unclear whether the current pent-up demand after a two-month lockdown will sustain as joblessness and pay cuts have been widespread.
Still, there has been a marked sequential improvement in demand-side indicators such as auto sales and electronic permits raised by businesses for transportation of goods (E-Way bills), according to a 3 June UBS Securities India Pvt. Ltd note.
Source: livemint
