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Know how much economic slowdown can affect India?

Friday - August 16, 2019 4:17 pm , Category : WTN SPECIAL
'Threat’ of economic slowdown on world due to the US-China trade war
'Threat’ of economic slowdown on world due to the US-China trade war

Global economic recession horrifies the whole world

AUG 16 (WTN) - It took a long time for the whole world to recover from the economic slowdown of 2008. But, by the time the economies of the countries around the world were able to recover from the economic recession of 2008, the economic recession had a negative impact on the GDP of the countries around the world, due to which millions of people had to lose their jobs. As the world was recovering from the economic downturn of 2008, once again there is an atmosphere of fear in the whole world due to the recession again. 

The famous American investment banking company Morgan Stanley has once again indicated about the economic slowdown across the world. According to Morgan Stanley, once again the global economic downturn is being feared due to the ongoing trade war between the world's two largest economies, the US and China. Economies around the world are seeing signs of slowdown due to the ongoing trade war between the US and China for a long time.

According to a report by Morgan Stanley, a possible economic slowdown will appear in the next 9 months. Now you must be raising this question that what will be the effect of this possible economic recession on the economy of India? So for your information, let us know that India will remain a little away from the ill effects of this possible economic recession. But, Morgan Stanley has advised the Indian Government that the Government has to be vigilant to deal with the global economic slowdown.

Although, the report says that the global economic slowdown will not have much impact on India, but the Government of India will still have to take necessary steps to avoid and deal with economic slowdown without ignoring it. It is not that economists in India are not aware of the possible global economic slowdown. Shaktikanta Das, Governor of the Reserve Bank of India, has said that the possible economic slowdown will not have much impact on India, because, in India, everything in policy is moving in the right direction. Central banks across the world are cutting interest rates due to a possible economic slowdown. In the same sequence, the Reserve Bank of India had cut the repo rate by 0.35 per cent in the past.

The Morgan Stanley report said that if the trade war between the US and China increases once again; in this case, the US could increase duty on goods exporting from China to 25 per cent. If America does this, the entire world will be facing an economic recession in the coming three months. As far as the impact of the global economic slowdown on India is concerned, not all regions of India will face economic slowdown. But, India's auto sector seems to be slowly reeling under economic recession.

As you know, the auto sector in India has been witnessing a slowdown for the last one year. During this period, sales from two-wheelers to four-wheelers have come down, while production has also been affected due to low sales of vehicles. For all these reasons, thousands of people have lost their jobs in the auto sector from sales to production. The downturn in the auto sector means that companies have either stopped production of vehicles, or have reduced them.

As we told you earlier, there is an ongoing trade war between the US and China. But, even as the trade war continues, negotiations are going on between these two countries to resolve it, but there is no positive result. Amidst all this, the US President Donald Trump says that the trade talks with China can be canceled. Experts in the American economy and American politics believe that Donald Trump's same attitude may remain until the US Presidential election to be held at the end of 2020. And if Trump stays the same, then the threat of the ongoing trade war between America and China will remain the US Presidential election.

For your information, let you know that in a tweet recently, Donald Trump said that from September 1, he would impose a 10 per cent tariff on goods worth $ 300 billion exporting from China. Trump said the tariff would be different from the 25 per cent tariff on goods worth $ 250 billion. Morgan Stanley says that if the US raised the tariff on China's $ 300 billion goods to 25 per cent, then the whole world would be in recession in next three months.

Clearly, the entire world may have to suffer the brunt of the ongoing trade war between the US and China. Everyone knows that US President Donald Trump is an irritable person. As such, Trump may increase tariffs on Chinese goods to 25 per cent due to presidential elections and competition with China.

In such a situation, how much this economic recession has an impact on the Indian economy? According to Morgan Stanley's report, the possible economic slowdown will not have much impact on the Indian economy, but the way the Indian auto sector has faced negative impact due to the slowdown, so there is a fear that the global economic slowdown may have more negative effects on the Indian economy as it was not expected.