Updated ppts

Recession and its effects on Indian economy.: 

Recession and its effects on Indian economy.

What is Recession?: 

What is Recession? A recession is a contraction phase of the business cycle. Generally, National Bureau of Economic Research (NBER) is the one that makes a decision on the current state of the economy. They define recession as a "significant decline in economic activity lasting more than a few months“, which is normally visible in real GDP, real income, employment, industrial production, and wholesale-retail sales.

What causes Recession?: 

What causes Recession? The normal economical cycle changes as there are fluctuations between the grown and decline of an economy. An economy typically expands for 6-10 years and tends to go into a recession for about six months to 2 years. When there is a significant amount of descent in the spending power of a consumer, that is the first step towards an economic recession.

Consequences of Recession: 

Consequences of Recession Recession in the US market and the global meltdown termed as Global recession have engulfed complete world economy with a varying degree of recessional impact. This has lead to a potential decline in the number of jobs available in most industries and sectors. It has also been a prime factor in factors like cost-cutting, and downsizing of all kinds of job salaries at all levels.

Consequences continued….: 

Consequences continued…. With the collapse of Lehman Brothers and other Wall Street icons, there was growing recession which affected the US, the European Union (EU) and Japan. It was due to a huge number of “failure to pay” situations in the American housing market. Because of the leniency of the American banks in approving perilous loans without considering any kind of secured guarantee from the customer. All this resulted in never seen balance sheets at the end of the year leading to financial disasters.

Consequences continued….: 

Consequences continued…. The primary underpinning of this economic crisis has been the actual sector known as “The Main Street”. This economic crisis really swallowed up the United States of America in all existing forms of crawling recession, which further lead to demurring the situation. As an outcome of this, the American demand for imports resulted in decreased numbers.

Consequences continued….: 

Consequences continued…. The badly hit sector at present being the financial sector, and major issue being the " LIQUIDITY Crises " in the market. Even though it was earlier being assumed that this economic crisis will not bring in any kinds of catastrophic effects on the Indian economy, it was hit upon later on that the Foreign Direct Investment (FDI) started aerating leading to a massive affect on the investment sector in the Indian economy.

Impact on Indian economy: 

Impact on Indian economy Stock Exchanges based on US and Europe (FIIs) Sudden sale of Stocks – Stock Market Crash & industries in general Exports come down Layoffs Work long for less salary Rupee weakening against dollars

Impact continued….: 

Impact continued…. A lot of industries were hit by this economic downturn, however, some of the most hard-hit ones were airlines, hotels and real estate. Not just the industries mentioned above, but the Indian exports as well as the production of export related sectors also experienced a major impediment . It was directed to the destabilized sectors by the government to cut down prices. This action resulted in some respite and reprieve as the expunge duties were decreased, but all the efforts were fated to fail.

Impact continued….: 

Impact continued…. Due to a deterioration in the demand, production was also cut-down. A lot of organizations also shrinked their labour in order to cut costs. To reduce the impact of the crisis, firms reduced their workforce, to reduce costs. Although, the above resulted in a high rate of unemployment but it was not an extensively large affect on the economy. Industrial production and manufacturing output declined to five per cent in the last quarter of 2008-09. Consequently, a vicious cycle of weak demand and falling output developed in the Indian economy.

Impact continued….: 

Impact continued…. Due to a diminishing demand, the IT and Business Process Outsourcing (BPO) sectors were largely impacted. Jobs abroad were affected as a lot of interns or new young applications tried but failed to get decent and rewarding salaried jobs or contracts. India’s famous IT sector, which earned about $ 50 billion as annual revenue, was expected to fall by 50 per cent of its total revenues.

“recession is the real killer not the terrorists”: 

“recession is the real killer not the terrorists” Recession cuts down exports and cool investment - before Mumbai Blast Decline in the economy began before attacks 2 of 3 hotels & Café which were targets of attack have reopened the business

PowerPoint Presentation: 

PLUS AND MINUS: PLUS ↓cost of living Export goods sold locally ↓products price ↓in real estate helps common man MINUS Job Scarcity High Retrenchment Low Liquidity Hit in export market

Bibliography: 

Bibliography http://www.scribd.com/hiteshsahni/d/7480461-US-Recession-and-Its-Impact-on-India http://www.mainstreamweekly.net/article1261.html http://www.articlesbase.com/international-business-articles/impact-of-global-recession-on-indian-market-655636.html http://blogs.hbr.org/cs/2008/01/impact_of_a_possible_us_recess.html http://www.slideshare.net/ramanraman/us-recession-and-its-impact-on-indian-economy http://www.firstpost.com/business/10-ways-the-us-crisis-will-impact-the-indian-economy-57612.html http://www.indianmba.com/Faculty_Column/FC1012/fc1012.html http://www.gasandoil.com/oilaround/south_east_asia/4609cf7a033e8895734720453945baa8

PowerPoint Presentation: 

Thank You….