Forecasting Potential Impact of COVID-19 on India and Indonesia’s GDP
31 Pages Posted: 15 Jul 2021
Date Written: July 12, 2021
Abstract
In this paper, the Box-Jenkins approach has been used to build the appropriate Autoregressive-Integrated Moving-Average (ARIMA) model to understand the short-term economic impact of coronavirus on India and Indonesia’s economies. The quarterly data for forecasting India and Indonesia's GDP was gathered from the Federal Reserve Bank of St. Louis to forecast the GDP from 2021-2025. As a broad measure of overall domestic production, GDP functions as a comprehensive scorecard of a given country’s economic health. We find that the appropriate statistical model for India’s GDP is ARMA (1, 1) and for Indonesia’s GDP is ARMA (2,1). Forecasts show that India and Indonesia will recover completely from the setback in 2025 q4 and 2023 q3 respectively.
Keywords: Box-Jenkins approach, India, Indonesia, Forecasting, Gross domestic product, ARIMA, Coronavirus, Economy, Unit Root, AR and MA, Pandemic, Time Series, Autocorrelation, ACF and PACF
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