It’s no secret that India’s economy was hit hard by the COVID-19 pandemic. Unfortunately, the great republic had to endure a second significant wave of COVID just as they were beginning to recover. Naturally, this disruption was a cause of great concern among business owners and investors that are active in the region.
FrontierView conducted a comprehensive India market review, which revealed that India is poised for a rapid demand rebound in Q4 of 2021. However, the economy’s overall growth will be moderate in the year 2022, due to waning demand.
With that being said, the government is making a strong push for domestic manufacturing. When combined with the booming eCommerce sector, the efforts of India’s leadership will ensure that companies have plenty of opportunities for growth in the medium term.
The APAC Outlook
FrontierView’s India Market Review revealed that the APAC forecast is generally positive for Q4 2021 and throughout 2022. Companies can expect India to recover to pre-COVID GDP growth levels by year’s end, and the nation should continue to experience moderate growth throughout 2022.
Still, the market remains somewhat volatile. Significant delays in vaccine rollouts, another massive COVID outbreak, or poor government spending practices could alter the current APAC outlook.
Implications for MNCs
B2C multinational corporations can expect a K-shaped recovery. Specifically, the demand amongst higher-income audiences will recover faster than in lower-income segments.
To win during this recovery period, B2C MNCs should maintain a steady price as opposed to lowering prices to drive sales. This is particularly important in the value segment, as these buyers continue to trade down as a result of the pandemic.
Conversely, B2B MNCs should be prepared for an uneven recovery. Certain industries, such as domestic manufacturing and civil construction, will rebound faster.
However, real estate construction and manufacturing exports may not exceed pre-COVID-19 levels of demand until the latter portion of 2022. The automotive sector will face the most significant challenges, as demand in that market will remain weak for a prolonged period.
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