India’s economic recovery from its COVID-19 lockdown

Chuck Burke | Feb 26, 2021

Sections Economics Public Policy

Collections COVID-19 Crisis

In response to COVID-19’s rise, India ordered most of the country’s 1.3 billion residents to stop working and remain indoors starting in March 2020—the world’s largest lockdown. The government began relaxing restrictions in June, and research finds that while India’s economy improved rapidly in the following months, the outlook for a return to prelockdown levels remained unclear.

In a report for Chicago Booth’s Rustandy Center for Social Sector Innovation, Booth’s Marianne Bertrand and Rebecca Dizon-Ross, Centre for Monitoring Indian Economy’s Kaushik Krishnan, and University of Pennsylvania’s Heather Schofield examined household-level survey data to establish a more comprehensive view of India’s initial recovery than national economic indicators could provide. These charts and maps highlight a selection of their main findings.

The lockdown affected income differently across states

Employment remained down as the economy opened back up

Income levels remained depressed as the lockdown was initially lifted

Top earners’ income didn’t drop as sharply during the lockdown months

Spending on basic food items remained down after the reopening