Lockdown losses could mount to Rs 12.1 lakh crore: SBI report

The overall loss owing to the national lockdown, which has been extended till May 3, could be around Rs 12.1 lakh crore, a State Bank of India (SBI) report said today, adding that the GDP growth for financial year 2020-21 is estimated to be around 1.1 per cent or even lower.

The report said that the lockdown will have significant impact on macroeconomic parameters. The worst impacted will be the estimated 37.3 crore workers in the country, many of whom are engaged as casual laborers.

“We estimate the income loss per day of these 37.3 crore workers due to lockdown is around Rs 10,000 crore, which translates into a loss of Rs 4.05 lakh crore for the entire lockdown period. For causal laborers, this income loss it at least Rs 1 lakh crore,” the report said.

The report has underlined the need to carve out a fiscal package which should “strive to more than make up for this Rs 4 lakh crore income loss.”

According to The Periodic Labor Force Survey (PLFS) report of 2017-18, there are 37.3 crore workers engaged as self-employed, regular and casual workers, with share of self employed at 52 per cent casual worker at 25 per cent.

The SBI report also said that the net tax revenue will have a shortfall of at least around Rs 4.12 lakh crore, while revenue shortfall for states is estimated at Rs 1.32 lakh crore. The revised fiscal deficit would be at 5.7 per cent of GDP.

However, in case extra-budgetary resources (EBR) rises the deficit could well go up to 6.6 per cent of GDP. The fiscal deficit of the states too would increase to 3.5 per cent of GDP from the budgeted 2 per cent in 2020-21. “We estimate that the EBR number will rise significantly as government will try to mobilize resources more through unconventional means like Covid Bonds, monetization of deficit and others,” the report said..