all registered establishments in India and abroad from April 2018 to October 2020. This data is collected by the tax authority’s _E-way Bill_ system to increase compliance for tax purposes. This is an advantage over standard VAT firm-to-firm trade datasets in developing countries, which suffer from severe under-reporting. By law, anyone dealing with the supply of goods and services whose transaction value exceeds Rs 50,000 (700 USD) must generate E-way bills. Transactions with values lower than 700 USD can also be registered, but it is not mandatory. The E-way bill is generated before transport (usually via truck, rail, air, or ship), and the vehicle driver must carry the bill with them, or the entire extent of goods can be confiscated. Our data is generated from these bills. This implies that our network is representative of relatively larger firms, but the threshold is sufficiently low that we are likely capturing small firms as well.

Each transaction reports a unique tax code identifier for both the selling and buying establishments, all the items contained within the transaction, the value of the whole transaction, the value of the items being traded up to 8-digit HS codes,<sup>15</sup> quantity of each item, unit, and mode of transportation. Each transaction also reports the ZIP code of both the selling and buying firms, which we use to merge with other district-level datasets.

Since the data report both value and quantity of traded items, we construct unit values for each transaction. We also calculate average unit values at the product-by-time-by-seller-by-buyer level, the number of transactions, and the total value of the goods transacted. This is the foundation of our firm-to-firm dataset used in the analysis.

**Lockdowns.** On March 25, 2020, India unexpectedly imposed strict lockdown policies nationwide. Districts were classified into _Red_ , _Orange_ , and _Green_ zones according to each district’s severity of Covid-19 cases. Each color corresponds to different lockdown degrees, where _Red_ was severe lockdown, _Orange_ was medium lockdown, and _Green_ was mild. Yet, at that time, there were barely any Covid-19 cases in India, as the entire country averaged about 50 cases a day (as opposed to about 400,000 cases a day the following year).

Districts in the _Red_ zone experienced the strictest lockdowns, where rickshaws, taxis and cabs, public transport, barbers, spas, and salons remained shut. E-commerce was allowed for essential services. _Orange_ and _Green_ zone districts experienced fewer restrictions. _Orange_ zones allowed the operation of taxis and cab aggregators, as well as the inter-district movement of individuals and vehicles for permitted activities. In addition to the activities allowed in _Orange_ zones, buses were allowed to operate with up to 50% seating capacity and bus depots with 50% capacity

> 15The data partially reports items up to 8-digit HS codes. Until April 2021, in India, it was only mandatory to report 4-digit HS codes of goods traded (See the Economic Times). 97% of transactions report 4-digit HS codes, and 40% report 8-digit HS codes. Given this, our main specifications are based on 4-digit HS codes, and we show robustness using HS-8 codes.

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