The Indian economy has suffered a blow due to the COVID-19 pandemic in spite of its massive 1.3 billion customer base, The Wall Street Journal (WSJ) writes.
India’s gross domestic product has fallen 7.5 percent compared to the same time in 2019, WSJ writes. While India was once among the world’s fastest growing economies, now it’s one of those that is contracting the quickest.
That comes with the territory of the way the virus has impacted the country — infecting over 9.3 million people and killing 135,000. Because of that, many Indian citizens haven’t been coming out again even as lockdowns lifted, preferring to save their money and stay hunkered down as much as possible, WSJ writes.
With many Indian citizens lacking in government safety nets, savings and ways to get to the hospital if there’s a need, less shopping seems to be one of their best options for avoiding the deadly virus, WSJ writes.
To help combat the economic decay, the Indian government is looking at deregulation methods, PYMNTS writes. The changes were approved by Prime Minister Narendra Modi and his Bharatiya Janata Party. They included provisions doing away with a regulatory system for how farmers sell their crops, expansions to the social security program, raised numbers of companies that can fire employees, higher requirements for unions and fewer rules about women working night shifts.
Amid the contractions, Chinese investors have been looking away from India after the country closed its doors to them. Instead, as Financial Times (FT) writes, they’re looking more toward Indonesia.
That has created a 55 percent increase in tech investment in the country, which is southeast Asia’s second-biggest economy. Numerous investment groups, including Shunwei Capital, which was introduced by Xiaomi founders, and Ant Group-backed BAce Capital, have signaled that they’re looking to invest more in Indonesia. While some professionals say the market isn’t mature enough yet, others see it as the next best thing to India, FT reports.
In April, New Delhi rolled out new rules against the opportunistic takeovers from China, which curbed a booming tech investment scene that previously powered many leading startups like Paytm, FT writes.