The financial year 2020-21 was a period when the majority of people in the country went through untold suffering. Crores of working people suffered due to the Corona Virus and due to the national and state level lockdowns. The total size of the economy, measured by the annual value added or Gross Domestic Product (GDP), contracted from Rs. 204 lakh crore in the previous year to Rs 197 lakh crore in 2020-21. Adjusting for inflation in commodity prices, this means a contraction of 8 to 10 percent in productive activity.
The financial results reported by 1100 listed capitalist companies for the year 2020-21 show that their combined net profits were 58 percent higher than in the previous year. Net profits had declined in the previous year, 2019-20. Thus the pandemic and lockdowns actually benefited the owners of the biggest capitalist companies in the country. These are monopoly companies, which control major shares of the market for industrial goods and commercial services.
Several factors have influenced the huge recovery in monopoly capitalist profits during the pandemic year. The most important factor has been the measures taken by capitalist owners to cut down their wage and rental bills.
Capitalist companies used the conditions of lockdown to cut down the number of workers employed, and in several cases, cut monthly wages as well. Many service providing companies made their employees work from home. They managed to increase the daily working hours and thereby extract more surplus value per human-day of work. They cut down on office space and saved on rent.
The Reserve Bank of India came to the assistance of the capitalist companies by cutting down the rate of interest it charges on advances to commercial banks. This led to a reduction in the interest cost for capitalist borrowers.
Movements in international prices also played a role. The drastic decline in the international price of crude oil during April-September 2020, for instance, boosted the profits of the petroleum refining industry. Recovery in international metal prices during the second half of the year boosted the profits of the steel and aluminum industries in our country.
What do all these facts, taken together, show? They show that the lockdowns imposed in the name of fighting against the Corona Virus have served the biggest capitalist companies in the country to intensify the exploitation of the working class and boost their profits. Under the cover of fighting against the virus, the ruling capitalist class, headed by the monopoly houses, is escalating its offensive against the livelihood and rights of the workers, peasants and all other toiling people.
 Money Control, 1st June, 2021; https://www.moneycontrol.com/news/business/economy/5-factors-that-led-to-a-rise-of-corporate-profit-to-gdp-ratio-to-a-10-year-high-6974761.html