UK Economy Contracts By 20.

4%
In June Quarter
Good morning to Lockdown measures led to record quarterly decline in
services, construction and production.

UK entered recession after GDP plunged by a record 20.4 per cent in the April-June
quarter. Lockdown measures led to record quarterly decline in services, construction
and production. Economists believe this heightens uncertainty for global economies
and poses a serious risk for developing countries.

Radhicka Kapoor, senior fellow at Indian Council for Research on International

Economic Relations believes even a developed country which had a large fiscal
package has clearly not been able to find its way through this crisis and has officially
slipped into recession.

"This show the difficulties developing economies which don't have such significant
fiscal room are going to face. India faced a far more severe lockdown and poor people
working in the informal sector are facing the maximum pain from the coronavirus
situation and the lockdown and there is going to be a serious problem to lift them out
of it,"

Although India manufactures one third of the global supply of medicines, over 80 percent of the
raw materials export to other countries. So I think the pharmaceutical industry is expected to see
a positive impact, on an overall basis, on its growth in this year. The market expectations are on
similar lines as indicated by the stock prices which for many pharma companies had risen by 20-
30% compared to the to the previous period. The situation will vary with the portfolio and size of
the companies. So this will have a great impact if online companies merge with Pharma
Company.
A lockdown essentially means people cannot go to work and in only some
cases you can have work from home but in most cases you can't. If work is
not done GDP is going to shrink, when production is not there and people are
not paid wages then incomes decline and therefore demand in the economy
falls. This is a double whammy of demand declining and supplies freezing.
Recovery becomes very slow as both consumption levels and investments
drop even if economies begin to gradually recover. U.K's economic data
seems to mirror the global impact of the lockdown due to covid-19.