The worse is yet to come even as India’s factory output measured by the index of industrial production (IIP) contracted by 16.7 per cent in March—the lowest in about four decades—with economic activities coming to a halt from March 25.

Manufacturing output declined by 20.6 per cent and electricity generation by 6.8 per cent. Many analysts said that this was worse than anticipated. For the full financial year 2019-20, industrial production shrank by 0.7 per cent.

The March number will also have a significant impact on the gross domestic product (GDP) for 2019-20, as exports and construction had already been reeling under pressure due to the spread of the novel coronavirus.

The IIP for March dropped after a seven-month high growth of 4.5 per cent in February.

And this is a prelude.

With the lockdown extending through April, expect the IIP numbers for the month to be absolutely dismal, something which will haunt the Narendra Modi government for months, even as it hurriedly announced a Rs 20-lakh crore stimulus package. The package includes the Rs 1.7-lakh crore relief package under the under the Pradhan Mantri Garib Kalyan Yojana and other measures carved out by the Reserve Bank of India (RBI).

The actual size of the fresh package is unknown leading to widespread speculation and skepticism.

Analysts said the fine print of the package will determine the speed of the economic revival. “We will have to wait and watch for the details, which will be announced for the next few days,” an analyst on condition of anonymity told IN.

Revival will also depend on how long the lockdown is continued. While Modi, in his address to the nation yesterday, said that the fourth phase of the lockdown will be different and that the novel coronavirus is here to stay, many have pointed out that the acute shortage of labor could pose a major challenge..