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The consequences of the corona disaster in India

Analysts have revised their economic forecasts downwards, and the ruling BJP party gets a disappointing result in the regional elections in West Bengal.

That happened: India's government under Prime Minister Narendra Modi has been caught on the wrong foot by the second, massive corona wave. Assuming that the country would soon achieve herd immunity, Modi had recently taken an extremely liberal course in containing the pandemic.

Last Sunday alone, India recorded more than 400,000 new infections, more than any other country has ever registered. In addition, 3700 people died. According to media reports, the health system has collapsed in some states, the crematoria cannot keep up with the cremation of the dead, in some places corpses are lying in the streets.

The consequences: The Indian economy will feel the consequences of the recent corona outbreak; However, the second wave is unlikely to stall the economic recovery.

Many states have imposed local lockdowns; There are, however, no nationwide and uniform measures across the country. In his analysis of April 26th, Priyanka Kishore, South Asia chief economist at Oxford Economics, writes that he is still anticipating economic growth of 10.2 percent for the current year. Before the latest wave, he had assumed an increase in gross domestic product of 11.8 percent. The high expectations for growth are based on a low base in the previous year.

In a quarterly comparison, Kishore expects the economy to contract from April to June. The reason for the probably manageable economic damage of the second wave in the end is the less strict lockdown measures compared to last year in connection with stable consumer demand. Kishore writes: "The economic data indicate that companies are learning to remain operational in the pandemic."

The politic: Regional elections were held over the weekend in the states of West Bengal, Tamil Nadu, Kerala and Assam. There was a surprise in West Bengal, where the national-Hindu BJP had expected Prime Minister Modi to have 200 parliamentary seats. In the end it was only 77.

The election winner was West Bengal's Prime Minister Mamata Banerjee with her party All India Trinamool Congress. Modi had held several election campaign events with high participation in West Bengal. He had ignored warnings about the high risk of infection.

This is what we mean: Even if India's economy should not be brought to its knees by the second wave: Thousands of people pay with their lives the price of Modi's liberal course.