Economic Case Study: The Impact of the US Recession on the Indian Economy

by | May 14, 2023 | Recession News | 43 comments




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VIDEO INTRODUCTION: The year of 2022, has been a roller coaster ride for economies all across the world, the Russia Ukraine war put both Russia and Europe in a recession, China is already facing an economic crisis due to both covid and real state issues and here in India, we have already seen the value of our currency going up and down like never before!! and same is the case with all the major currencies across the world!!

On top of that, now the United states seems to be heading towards a recession!! and this has sent shock waves all across world!! Why??? Because if the biggest economy in the world witnesses a recession its going to have a ripple effect on economies all the world including India!!
So in this case study, Let’s try to understand,
Why does everyone think America is heading towards a recession?
How will this affect the economy of India?
What can you do as investors to benefit from this recession?
and most importantly, what are the study materials to help you understand this upcoming economic downturn!!

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The United States of America’s economy has been grappling with a recession due to the ongoing COVID-19 pandemic. The US economy has been hit hard with businesses shutting down, people losing jobs, and dwindling consumer confidence. Inevitably, this recession will have global implications, including affecting India’s economy.

The repercussions of the US recession will be felt in India as the latter is an important trade partner with the US. The US is India’s largest trading partner, accounting for 15% of India’s exports and 7% of imports. Moreover, India’s IT industry, which generates a significant proportion of its foreign exchange, wholly depends on the US market. The US is the largest market for Indian software services, and any fall in demand will hit India’s IT industry hard leading to job losses and shrinking revenues.

India’s automotive sector is also heavily dependent on the US. Automobile exports to the US make up a sizeable proportion of India’s exports. With a recession in the US, the demand for vehicles will decline, leading to a slump in India’s automobile exports. India’s auto components sector, which supplies to the US, will also take a hit.

The Indian pharmaceutical industry, which is heavily dependent on raw materials from the US, will be affected. The cost of importing raw materials will surge due to the weakening of the Indian Rupee against the US dollar. The US recession will increase the demand for generic drugs that might prove beneficial to Indian companies, but the supply chain could be affected due to supply chain disruptions.

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The US recession is also likely to affect the Indian job market. With businesses facing uncertainty and cost-cutting measures, there is likely to be job losses, affecting millions of Indian employees. Indian companies that depend on US investments could also face tough times, leading to cutbacks, impacting India’s economic growth.

However, it is not all bad news for India as the US recession could bring opportunities for Indian companies. US businesses might look to outsource work to reduce costs, further strengthening India’s IT sector. Moreover, India’s import of crude oil and liquefied natural gas (LNG) from the US could also become cheaper due to the recession.

In conclusion, the US recession will have both direct and indirect impacts on India’s economy. The Indian companies should prepare for the worst while seeking opportunities during this downturn. A global recession is always a challenging time, but innovative ideas can lead to companies seizing economic opportunities.

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43 Comments

  1. Abh1sh3k

    Correction 8:10 "Everytime recession happens inflation goes up" is an incorrect statement. Inflation decreases due to recession as there is less demand for goods and services.
    But Higher inflation may result in a recession and not the other way around

  2. THOR

    This guy subtly promotes BJP

  3. Music waves

    Is gold price goes up?

  4. bharath kumar

    Thanks think school for making yield curve inversion understand in a simple way

  5. Yunus Jhon

    Be pride with Bricks under Domination Of China is New threat of Communism versus Democracy.

  6. Vishesh Agarwal

    where can we see the yield curve??

  7. Vinay Sharma

    De Dollarization Effect

  8. Viswanath Bulusu

    As a commoner, I feel India should explore more market, and create domestic consumption internally to augment such situations as a policy matter.

  9. Hari Prasadh

    Well done. Love all your geopolitics videos ❤

  10. Saurabh Dwivedi

    Can you share the link of resource where we get the 10 year vs 3 year interest rate graph for bonds.

  11. Rosh

    Thanks to certain corporate scam!!! we are not depende nt the changes in US markets for down growth and slowing of economy.

  12. s n

    The concept of Dharma …. (Excerpt from message of Shri Datta Swami)

    Word Dharma means characteristic property which stands for identification of an item. Dharma of fire is burning by which it is identified as fire. It is expected natural behavior of an item in creation. If fire is cool, such coolness is Adharma which means that it is not the expected property of specific entity. Human being in this creation is a specified entity & is expected to show certain characteristic properties (Dharmas) by which he is identified as human being. If human being shows characteristic properties of other specified items, it loses its identification.

    When God created various items in this world, He has assigned certain characteristic properties to be associated with corresponding items. So, possession of Dharma is will of God. Balance of creation is maintained when specified items exhibit their specified properties assigned by God. All inert items like fire, water etc. are strictly following will of God. God created this universe for entertainment.

    Entertainment is disturbed if natural balance is upset. God has given freedom to human beings, which is inherent desire of souls. God has full freedom to change any characteristic property of any specified item. When He wished, fire could not burn, air could not move & water could not quench even a dry grass blade. Since He is omnipotent, He has unlimited freedom. But souls have very little potentiality. Their freedom is naturally conditional & limited.

    Living being has little freedom within its specified boundary of its potentiality. If freedom is not given, it is not a living being. Among living beings, human being has full potentiality due to analytical faculty (Buddhi) & thus relatively more freedom is granted to it. Human being should understand limits of its capability & should freely behave within that specified boundary. Such behavior is Dharma which is expected by God. If limits are violated &behavior of some other category like animals is shown, soul is pushed into life cycle of animals.

    YouTube Channel: Shri Datta Swami

  13. Aden Mall

    We are currently in the jaws of the worst bear markets I have seen, the average stock has been cut in half, and the only way to make money this year has been to either short or to trade long in very short time frames. I'm still at a crossroads deciding if to liquidate my dipping $117k stock portfolio, what’s the best way to take advantage of this bear market?

  14. VIKRAM PATIBANDLA

    Waiting for a case study on Scrappage policy

  15. Karen Freeman

    You wanted to blame me for your debt payments. Biden and kick me off u tube bye for now. Kim and Laura are your smartest people on the planet.

  16. Arpita RC

    This recession is a forced man made event because of the egoistic bigots ruling US, suffering from bl00dy "messiah" syndrome

  17. MAYANK JAIN

    One of the reason for upcoming recession in US is also China. Before there were many ships waiting to be unloaded At the US shipyard but now there are not many only7-8. Due to which companies can have there commodities from there fav destination China. And so due to no or low productivity companies like Amazon have decided to cut down there current expanded units and close there newly established units causing layoffs……cut to the software business which he explained, due to less business no one is ready to upgrade or install new business..

  18. varun maurya

    i'm watching this one day before my international marketing exam

  19. Noor Tasheel Ahmed

    Quick question: How does increase in interest rates decrease the inflation?

  20. Danilo Ymasa

    THANK YOU SO MUCH SIR….EXCELLENT ANALYSIS and SHARING….GOD BLESSED YOU ALWAYS…

  21. Swapnil Dhote

    When does a recession happen?

    "When demand peaks and starts to decline, the excessive supply of goods and services that aren't consumed can lead to a recession, with companies producing less and downsizing while people lose purchasing power and consumption continues to fall."

    I am a layman but I think this is way how it works in terms of businessman or capitalist. If I would be a businessman, I would definitely want more and more price for my product there is no end of it. That is the problem with CAPITALISM. Basically it has no control. So, when the demand rises again after peaking I will start producing but at a new price, I would want that so that I can earn more.

    If the businessman has taken loan for that purpose also will have to pay higher interest for that purpose will also eventually effect my price.

    So, when the demand rises again the goods in the market become expensive and indirectly causes inflation.

    I think Think school is right is doesn't cause inflation directly but indirectly it does.

  22. Dexter Whymns

    God is king of the world not amrican your super power will fall sooner then later

  23. Brandon Glover

    With markets tumbling, inflation soaring, the Fed imposing large interest-rate hike, while treasury yields are rising rapidly—which means more red ink for portfolios this quarter. How can I profit from the current volatile market, I'm still at a crossroads deciding if to liquidate my $125k bond/stocck portfolio

  24. Kevin Marten

    Yes stocks are pretty unstable at the moment, but if you do the right math, you should be just fine. Bloomberg and other finance media have been recording cases of folks gaining over 250k just in a matter of weeks/couple months, so I think there are alot of wealth transfer in this downtime if you know where to look.

  25. Devendra Sahasi

    Super like

    One of the best video on recession.

  26. prajakt0789

    Msme ko barbaad kar diya hai present leadership ne. Reforms toh ban nhi rahe inse. Bas taxation badhao aur paisa idhar udhar kharch karo. Aur log bhi lage hue hai bandaro ki tarah taali bajane me. Wealth distribution bigadte ja rahi hai. Kuch chuninda log puri malai kha rahe hai aur amir par amir ho rahe hai baki bichare bas bandaro ki tarah taali bajakar false pride lekar baithe hue hai. Commission aur corruption culture desh ko kha raha hai puri tarah se. Hamari desh ki collective wealth k hisabse sare log ab tak prosperous hojane chahiye the par logon ko khudko ye baat samajh me nhi aa rahi. Nyay keval amiro k hath ki katputli bankar reh gaya hai. Ek dusre se insaniyat k bhaichare k rishte khatm hote ja rahe hai. Dilo me katuta bhar gayi hai aur log fir bhi lage hue hai bandar ki tarah taali bajaane me. Parivartan ab jaruri hai. Its important to flee these corrupt inept and selfish leaders running the nation today.

  27. Deepak Sharma

    Pls stop this war..why we all are fighting ..we need to understand …

  28. Daniele Ellis

    Money doesn't grow on trees

  29. Arun

    Thank you for explaining in detail. Learned something new from this video…

  30. Varun Balakrishnan

    Hai Ganesh, you are the real product of Bharat. The original and final Arjuna product what Krishna wanted.
    Coming to the point, hope this recession will not have much effect on Indian economy and markets, the ripples may have a slight change though!!

  31. ExclusiveLM

    ,,Here is the true definition of a Recession specifically for the future. Recession: when the wealthy top 10 percent take more money from the economic pie into their corporate banks or put their profits into other investments without trickle down effects good enough to help the middle class and poor keep up with the cost of living while enjoying tax loops, of shore accounts, and being bailed out by the government whenever they risk peoples life savings in Wall Street without repercussions and buying off politicians to get Deregulation Laws and other laws passed that will favor them. In other words, there is never a true Recession for those that cause Recessions. That never ending greed has destroyed many economies in the history or the world. In the past the greed involved taking over other countries…. Sounds familiar??? Now greed is about amassing as much money and land as possible. That concludes the definition of Recession. Remember people that wherever there is economic congruence, there is no chance for the quote raising of prices on everything in the name of capitalism and salary wages are commiserate with the cost of living.

  32. Sushruth K

    Now I see Indian markets at an all time high. Still I believe in Indian markets. Don't fear for the crash. It will not last forever. Do proper study and invest in India. ❤️

  33. Surbhi Sarda

    Is it a good time to buy a property with 3 years possession. I m not sure to what extent recession will hit the IT sector and real estate?

  34. o'neil jerry

    Recessions are part of the economic cycle, all you can do is make sure you're prepared and plan accordingly. I graduated into a recession (2009). My 1st job after college was aerial acrobat on cruise ships. Today I'm a VP at a global company, own 3 rental properties, invest in stocks and biz, built my own business, and have my net worth increase by $500k in the last 4 years.

  35. Ani SPW

    Not necessary

  36. Arivuchelvan Kasi

    You need something in first place to shake that.

  37. Nikol C

    Inflation and deflation are natural phenomeon and part and parcel of life. every few years it occurs.

  38. AMN HAWK

    Recession is reaction of nature that exhausted after consumed too much resources by greedy people while not enough supply and wasted it deliberately.

    Back to nature life again for safe climate change.

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