Economic and Price Developments during the COVID-19 Era and Their Outlook Impact of COVID-19 on the Economy Let me start with a look back at economic developments this year, mainly focusing on the impact of COVID-19. COVID-19 started to spread from the beginning of the year and became a pandemic within a short period toward early spring (Chart 1).
Yet, just four years ago, an ocean of vulnerability engulfed the economy. The situation around the “taper tantrum” seemed so dire that even a growth rate of 6.6 per cent and foreign exchange reserves of close to US $ 300 billion seemed like matchsticks before a tide that swept India into the infamous ‘fragile five’ in that fateful summer of 2013.