Impact of the COVID-19 Pandemic on India and it’s Neighbouring Countries: An MSME Perspective

Abstract

The COVID-19 pandemic triggered an unprecedented global economic disruption, leading to sharp contractions in output, employment, and cross-border economic activity. While the global economic effects of the pandemic have been widely documented, comparatively less attention has been devoted to its differentiated impacts on India’s neighbouring countries, particularly from a Micro, Small, and Medium Enterprises (MSMEs) perspective. This study examines the pandemic’s economic impact on selected neighbouring countries of India, with a specific focus on MSMEs, which play a crucial role in employment generation and economic activity across the region. Using secondary data from international statistical sources and country-level reports, the study analyses cross-country variations in GDP growth performance and documented disruptions faced by MSMEs during the pandemic period. The findings reveal substantial heterogeneity in the depth of economic contraction and recovery patterns across countries, reflecting differences in sectoral dependence, exposure to external shocks, and policy responses. The study contributes to a region-specific understanding of the pandemic’s economic consequences and underscores the importance of strengthening MSME resilience to enhance preparedness for future systemic shocks.