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The biggest fall in per capita income to Rs. 1.43 Lakh p.a.

Experts from financial sectors have been impinging on the fact to have money such that you can maintain your households for at least 6 months. The uncertainty in economical stability is because of lockdowns and consecutive lockdowns.

With the increasing cases of COVID in India, the unpredictable lockdown phase will not only extend but increase. The country’s growth rate has taken a hit and has affected many livelihoods.

The SBI (State Bank of India) with its expert research team assembles the reports authored by Dr Soumya Ghosh, Group Chief Economic Adviser. It stated that the per capita income (PCI) will decline by 5.4% the coming year 2021 i.e. Rs. 1.43 Lakhs.

Read more: The last chunk of Rs. 20 Lakh crores addressed by our FM, Nirmala Sitharaman. 

State-wise hit:

But the sad heart of the fact here is the decline in income rate is more than the decline in GDP which is 3.8%. Here is how this dip affects state wise, the rich states are more prone to be hit by the dip in per capita income.

Especially, in places like Delhi, Chandigarh the decline in per capita income is more than the normal dip (around 13-15%) in overall India. More states like Maharashtra, Gujarat, Telangana & Tamil Nadu will have a decline in per capita income by 10-12%.

Complete de-stable nation recovery:

The total dip constitutes 47% of India’s GDP, which includes the above states and Union territories. This is most alarming because the state hit is in double digits compared to the national decline in PCI.

Besides them, the not so well-off states like Madhya Pradesh, UP, Bihar, Odisha the decline stands in between 5-9%. But, the SBI study counters another analysis that this gap will narrow down post-COVID pandemic.

Global crisis:

Universally, many nations are yet to witness a huge contraction in GDP growth rate in the coming year 2021. So far, for India, the report projects a GDP decline of 6.8%. The consecutive year post-2021, India will recover will show statistical recovery in 2022 and thereby will take two years to bring things to normalcy.

In the history of the market, such experiences take an average of 3-4 years for recovery from the crisis to decrease the inflation in growth rate.

Read more: The last chunk of Rs. 20 Lakh crores addressed by our FM, Nirmala Sitharaman. 


Managing finances now will be a herculean task because of job lay off and pay-cuts. Maintaining the household expenses for the next 6 months without an income with emergency funds is a bitter task we have to adhere to.

Holding your dues, credit card bills pending or debt pending is not something i.e. advisable.

Unless you run out of funds completely do not dig into your investments or funds.

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