
I am not a market expert and although I do hope we witness a V-shaped recovery, few facts which I think should be noted that can work against the recovery:
1. U-turn – We were already in slowdown and GDP was dropping marginally ever since 2016 where it rose to 8.1% from 5.2% in 2011. Possibly the longest bull-run ever in Indian history. Only to get halted by demonetization. Followed which we have only witnessed the U-turn.
2. Patchy – Major tax reform the country witnessed in years in the form of GST. But, the indirect tax revenue collection is hardly close to its projections; down by 40% despite heavy optimism poured by FinMin on the camera in any events, when asked about her views.
3. Pernicious – Year after year the waves kept coming, Defaults by various cos be it PSU banks or private cos from IL&FS, JetAirways, DHFL, Yes Bank, PNB, PMC to name a few. All at utterly bad timings. Nobody knows how many dead skeletons are yet to be discovered from the books. The financial burden of RBI likely to rise in given months as defaults expected touch peaks in coming months starting with Vodafone Idea* (personal view)
4.The sick patient – Auto industry. Ever since the dawn of economic slowdown/EV reforms/BSVI announcements by the present government. Sales down up to 30% across segments compared to 2018-19. With the virus further knocking it down to last breaths. Hopefully enough damaged to get the government’s attention now to roll out reforms for the start of recovery.
5. Old scar – Air India’s departure story continues with the private aviation industry itself seeking relief package from the government. An irony in itself!
6. Debatable – The rising unemployment question from the past couple of years owing to slow down and failure to answer the question by the government.
Sure it is going to be a mammoth task for the RBI and the Central & State Governments but I am quite optimistic that we will endeavor.