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This article is written by Ramanuj Mukherjee, CEO, LawSikho.

These are hard times. 

I have never seen times like these as an adult. 

When I was a toddler, in 1991, India was in deep financial trouble. There was massive inflation, earnings were stagnant and even people with government jobs struggled to put food on the plate. 

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When I was growing up, being able to afford a taxi, phone connection or even having a pet was an unimaginable luxury. Kids like me could not even buy a chocolate bar. 

But then things changed.

We changed our economic system in 1991, opened up our economy, and integrated ourselves with the global economy. Everything changed thereafter.

Since then, India has grown fast and steadily. In no time, we became one of the fastest-growing economies in the world. 

Since then, more than 30 crore people came out of poverty and achieved prosperity in this country.

If you compared to the years before 1990, the last 3 decades have been amazing and times of unprecedented prosperity. The economy grew at 8-10% per year, whereas it used to be a poor 2-4% earlier. 

So most of us are now used to 30 years of steady growth. Even the 2008 recession that rocked the world did not touch us in India. Our Indian economy weathered a little bit of shock and continued to achieve massive growth.

So we have no experience in handling economic pain. None of us have really seen a bad economy, until now.

And it all happened so suddenly. 

How are you doing? If you are struggling, as a lot of people are, do not worry. Hard times pass. However, you need to make sure that you understand what is going on and have a plan on how you are going to handle this situation.

Being caught off guard will be a terrible, terrible idea.

Do we really have a recession in our hands?

It is a foregone conclusion. Only question is how bad it is. Will we just have a quick, short recession or are we going to launch into a depression head first? 

Contraction projections from respectable international organizations range from 3% (IMF) to 5.2% (World Bank) and 6% (OECD) – but everyone is predicting that the global economy will contract in 2020. 

How about India?

In the current fiscal, India’s economy is projected to see a contraction of 4.5%-12.5% in GDP. However, the damage may not be just a contraction, but the ability to bounce back is at stake. Is our economy resilient enough? How much damage has taken place and how much more is ahead of us?

The Indian economy is in complete chaos, and India may be looking for something worse than a recession. 4.4 crore Indians were said to lose jobs when the lockdown started. 1.3 crore have been reported to lose their jobs after that. According to some surveys, one-third of India’s households are facing a livelihood crisis as people lost jobs and work. 

If these numbers are correct, the economic shock will keep penetrating deeper and deeper and keep creating a new level of chaos every new month. There will be second order and third order devastations that will take a while to unravel. So things are likely to get much worse from here. 

Unless there is a very fast recovery, the signs of which are nowhere to be seen right now, India seems to be on the verge of depression going ahead – recovering from which could take a long time.

Of course, there is a possibility that the government may be able to prevent the worst through stimulus and reforms, and thanks to inherent growth potential the economy may bounce back, but it is still a far cry.

As of now, people in their 30s and 40s are losing jobs and moving back to their hometowns to live with parents because they can’t afford rent anymore. The unorganized sector was first to be hit, but now the problem has reached the organized sector as well which is seeing unprecedented revenue loss, job losses, and survival struggle.

There are some bubbles of prosperity even in this environment. Some sectors have remained neutral, and others have grown faster due to the crisis. Tech sector is a good example of this. Work from home norms and the financial crisis meant that employers from big economies have been hiring Indian techies en masse. Software as a service (SaaS) companies are doing well, so are edtech and telemedicine companies. E-commerce is seeing an unprecedented boom. The business of taking offline processes online has proved to be a golden opportunity. 

Outside digital too, a few other things have been doing well. Indian pharma is seeing a revival. People are buying more insurance, spending more on digital media and entertainment, supplements, healthcare and fitness. Some MNCs are spending more on R&D and legal. 

However, these are limited sectors. Core sectors are struggling a great deal. Big employment generators like real estate, banking & finance, tourism, travel & hospitality, retail, and even unorganized local shops and establishments are experiencing a near-catastrophic wipeout. 

What would be your survival strategy?

This kind of economic catastrophe does not impact everyone equally. Your first priority should be to insulate yourself from the economic risk as far as possible.

Let’s understand who gets impacted more. Let’s start with businesses:

  1. Businesses with bad cash flows and less working capital;
  2. Businesses that are not very competitive but depend on things like location, personal relationships, low price/ lower margin are first to get into trouble;
  3. Businesses that are less efficient or failed to build a brand are always in a danger zone in tough times;
  4. Those who do not have strong sales funnels or marketing channels or business models are very vulnerable;
  5. Businesses which fail to predict what is ahead or prepare for eventualities, or assume things will be business-as-usual are at risk. Preparedness matters a lot; and
  6. Businesses that fail to adapt. Almost all businesses were impacted by the pandemic. Some adapted quickly, others could not change.

Which employees and professionals are at risk?

  1. If you are working at a job with an employer that falls in one of the categories above.
  2. If you are not competitive at your workplace, i.e. you can be easily replaced by a cheaper alternative, then you will probably be replaced.
  3. If your relationships and allegiances at the workplace are not strong and well-aligned, you could be at risk at a time like this. People who are better networked and have taken time to develop a professional reputation are unlikely to be in great difficulty.
  4. If you are not productive but manage to hang on to a job due to good relationships, you are probably getting into trouble.
  5. If you are not adapting to change with the needs and demands of the new economy, if you are not refocusing your efforts on the sectors that have big enough demand, you might be waiting for a disaster to happen. 

What can you do to be safe and stay strong during the recession, or even economic depression?

  1. The only way to be safe in this economy is to be a top performer. People who deliver results are always in demand, but during the recession, they can be a lifesaver. People who are ready to work hard and find ingenious ways to make things work are needed more than ever. This is your chance to grow faster than ever by delivering results and proving what you can do.
  2. Do not blindly chase money; it is an awfully bad time to do so. See where you are. Where do you stand in your organization? Are you valued? Are you indispensable?  Is this a business that has strong fundamentals? Can it withstand these trying times?
  3. It is time to be honest with yourself. Where are your weaknesses? Where do you come up short? Where are the chinks in your armor? Where are you failing to deliver results? How can you plug those gaps? 
  4. This is time to work very hard with a lot of authenticity and integrity. This is no time to slack off. You have to emerge out of this stronger, and it is not going to happen if you slack off.
  5. You will not get the opportunities you want. In times like these, you are lucky if you get a half chance. You need to make something out of nothing. You have to be relentless and always trying to convert any chance you get, and then you may get some. You need to be hungry and you have to act.
  6. You have to be an optimist in the face of all the troubles staring at you. You cannot put in the work that you have to put in unless you have courage in your heart and a sparkle in your eyes. You need to inspire people around you with your optimism and the fire in your belly. That will set you apart.
  7. Take care of your health. Physical and mental both. Make sure you are developing a strong character because integrity and authenticity will give you more power to survive times like these, while any attempt at manipulation, dishonesty and deceit will take away your power and make you weaker.
  8. Can you reorient yourself to work for the bubbles of prosperity? Those sectors have high demand for top performers but you may need to learn some new skills or learn more about those sectors to get those opportunities.
  9. You have to rise to the occasion. It was during a deep economic crisis that India finally woke up to its true potential and did the hard work that changed everything in 1991. We ripped off the band-aid of license raaj, socialism plus protectionism and embraced capitalism and globalization. How can you rise to the occasion? What reforms are needed to your mindset, to your work ethics? What skill upgrades have you been postponing? 
  10. India can come out of this recession with a stimulus and fundamental, big bang reforms. What are the big band reforms in your own life? What stimulus can you give to your own career? It is high time you do those things – because only the fittest survives and thrives. 

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