GREAT RECESSION OF

2008 IN INDIA
BY:
7324- Harshvardhan Singh
7328 –Naresh Patel
7332- Karan Mittal
7336-Samrat Singh
 What is RECESSION?
• A RECESSION is a decline in a country's gross
domestic product (GDP) growth for two or
more consecutive quarters of a year.
• A RECESSION is also preceded by several quarters of slowing down.
• RECESSION is the result of reduction in the demand of products in the
global market.
National Bureau of Economic
Research(NBER)
National Bureau of Economic Research(NBER)is the Official agency in
charge of declaring that the economy is in a state of Recession.
They define recession as: "Significant Decline in Economic activity lasting
more than a few months , which is normal visible as decline in GDP, Income
Employment, Industrial production , And Wholesale-Retail Sale”.
 What Causes RECESSION?
• An economy typically expands for 6-10 years and tends to go into a recession
for about six months to two years.
• A recession normally takes place when consumer loose confidence in the
growth of the economy and spends less.
• This leads to a decreased demand for goods and services, which in turn
leads to decrease in production ,lays- offs and a surprise in unemployment.
• Investors spends less as they fear stocks values will fall and thus stock market fall on
negative sentiment.
 GLOBAL RECESSION
• It is rightly said that, “when US sneezes the world catches the cold”.
• Economists at the International Monetary Fund (IMF) state that a global
recession would take a slowdown in global growth to three percent or less.
•
• The IMF estimates that global recessions seem to occur over a cycle
lasting between 8 and 10 years.
 Impact of Recession on India
• Indian companies have major out sourcing deals from the US .
• India's exports to the US have also grown substantially over the years .
• For the first time in five years , India’s export growth has turned negative .
Exports for October 2008 contracted by 15 % on a year -on -year basis as
over 40 % of India’s export market had beens lowing for months .
• This became on those reasons due to recession stroked India
 EFFECTS OF RECESSION
• Bankruptcies
• Credit crunches
• Deflation(or disinflation)
• Foreclosures
• Unemployment
EFFECTS OF RECESSION ON DIFFERENT SECTORS OF THE
COUNTRY

• Share Market
• Information Technology Industry
• Real Estate Sector
• Industrial Sector
• Banking Sector
• Agriculture sector
• Export/Import
• FDI
 Corrective steps taken to Check Recession
• RBI needed to neutralize the outflow of FII money by unwinding the market
• In the IT sector, there should be correction in salary offerings rather than job
cutting.
• Public should spend wisely and save more.
• Taxes including excise duty and custom duty should be reduced to lighten the
adverse effect of economic crunch on various industries.
•  In real estate the builders should drop prices, so as to bring buyers back into
the market.
 You
hank
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