Impact of CoronaVirus on Indian Economy and People?

With the spread of the contagious pandemic India and the world is coerced to put its people into self-quarantine to contain the diseases. The decision has led to partial shutdown of the nation leaving a stranded economy behind.

Coronavirus and the Economic Slowdown

The recent outbreak of coronavirus is due to SARS-COV2 (Severe Acute Respiratory Syndrome CoronaVirus 2) first reported in Wuhan province of China in December 2019. The disease caused by the virus is named as COVID19.

The virus is so contagious that it has engulfed the whole of the globe. Millions of people are infected throughout the world and thousands are dying due to the diseases.

With no known effective treatment and vaccination for the disease the only way to prevent the spread of COVID19 is to follow social distancing and isolating oneself to homes as well as maintaining one’s immune system, follow health tips to fight with such virus.

Sticking to homes implies one has to halt working outside. Lockdown in the country implies a restricted movement of goods within the nation and outside. Such adverse but necessary measures taken by the government are degrading the economy.

International travel is not allowed. Interstate transport is restricted. Industrial projects, manufacturing companies, construction sites, all are closed and all ongoing work is left unfinished. Such steps are definitely going to affect economy.

Nationwide Lockdown

• • Restricting the movement of people out of their houses. It is a mild curfew where one could step out for essential work.

• • Markets, shops, and services are closed allowing only necessary ones (pharmacies, banks, groceries, etc.) that too for a limited time in a day and with terms and conditions.

• • All commercial companies, and IT sectors, are closed. If possible people could work from their homes.

• • Schools and colleges are suspended.

• • All public gatherings, social, sports, and religious events are prohibited. Places of worship for all religions have shut down.

• • All public transport (buses, trains, flights) are cancelled.

• • All ongoing construction projects are put on hold.

• • Transport business including the cab services like Uber and OLA are also not working. This has further increased the job issues.

• • Out of panic people are withdrawing money from stock markets.

• • Because of nationwide lockdown the revenue collection is going down.
  • Buying and selling of goods has decreased, which is further affecting the income of many people.

• • With no work and jobs average income is lowering.

Impact of Lockdown on Economy

A nation’s economy grows when people have jobs in their hands, all the established businesses are working fine, country’s population has some money in their hands to spend.

But amidst the ongoing lockdown these things have frozen.

Apart from industries in which one could ask their employees to work from home to keep up the pace of their business, work has completely stopped.

• • Manufacturing plants and under construction sites are worst hit.

• • Many people are left jobless, homeless, and without a penny in their pockets. The poor, daily wagers, and laborer are among the worst hit.

• • A surge of immigrants was observed throughout the nation. Hunger and insecurity is lingering within the mass population.

• • Due to the shortage of food items, there is a rise in price of essential commodities.

• • Businesses are closed. People are being thrown out of their jobs. Companies are facing loss amidst the lockdown. This is a sign of an upcoming recession.
  • All infrastructure related work has stopped.

• • Students’ career is at stake especially those in their final years of schools and colleges.

With jobless population, rising inflation rates, dropping businesses, coronavirus and its containment plan has adversely impacted the Indian economy.

Coronavirus and Economical Breakdown in India

No doubt the coronavirus has hit hard on Indian economy. Economists are analyzing the situation due the lockdown imposed to contain coronavirus disease.

Some of the issues faced due to which the economy is slowing down.

• • Unemployment has gone up to 26% from 6.7%.

• • There is an income drop due to slowing business

• • Due to lack of transport, agricultural produce is getting spoiled. Since the produce is not reaching markets, prices are rising due to shortage. Both the common man and the farmers are facing issues.

• • SMEs and startups are impacted due to lower funding.

• • The meat market of India had faced a loss of many crores.

• • Because of production issues export services are cut.

• • By obeying social distancing and avoiding mass gathering the entertainment industry also freezes.

• • Manufacturing services are suspended by many commercial industries. Maruti claimed that they hadn’t sold even a single vehicle in the month of April. These manufacturing companies are facing huge losses.

• • Due to lockdown e-commerce sites like Amazon, Flipkart, etc. are also dealing with losses.

• • Stock market had crashed twice during coronavirus lockdown.
  • GDP has greatly reduced.
  • Tourism industry is completely shut. While people working and earning through tourism are now jobless.

Coronavirus is spreading at a high rate due to which some unfortunate but required steps are taken by the government to contain the disease.

Growing unemployment, staled agricultural produce, halted manufacturing due to coronavirus has broken Indian economy. It needs to be repaired slowly by taking insightful steps in coming days.

Lockdown Phase 4 – What Opened and What Didn’t

With Covid-19 cases reaching 1 Lac at the end of 3^rd lockdown in India, Indian Prime Minister Mr. Narendra Modi announced that the 4^th phase of Lockdown will be a different one from the previous 3.

The Ministry of Home Affairs (MHA) issued fresh series of guidelines in Lockdown 4 to State Governments & State Authorities regarding opening of Local Shops, Transport, E-commerce Services, etc. after taking into consideration the parameters shared by the Ministry of Health and Family Welfare.

Below Services have resumed in Lockdown 4

1. 1. 1. Inter State transport of Buses and Personal vehicles is allowed in Green zone and restricted in some areas of Orange zone.
      2. Shops are opened but should maintain a 6-feet distance between customers.
      3. E-commerce services like Amazon have resumed to delivering other items apart from Essentials as well which was restricted in the first 3 phases of lockdown.
      4. Airline services have resumed in India since 25^th May and all 6 seats in a row will be booked.
      5. Restaurants can operate Home delivery.
      6. Special Shramik Trains are allowed in the country. Local Railway services remain suspended.

Below Services remained shut in Lockdown 4

1. 1. 1. All International Air travel is suspended except emergency services like Air ambulance, etc.
      2. Passenger trains will remain shut.
      3. Religious places will remain shut.
      4. Schools, Colleges and Educational Institutions will remain shut till further notice.
      5. All Cinema Halls, Gyms, Shopping Malls, Swimming Pools, Parks, etc. public gathering places will be closed.

How can the economy be stabilized?

As the Lockdown 4 approaching to end soon, the government needs to take urgent and robust measures to control the downfall of Indian economy. It should be ensured that people have some money in their hands to maintain money flow in market.

The finance ministry has allotted a large amount for the benefits of daily wagers. RBI has cut down reverse repo rates. A relaxation on tax payments, loan payments is also announced by RBI to lessen the impact of CoronaVirus on Indian Economy and people.

But these steps are beneficial only for the period of lockdown. Steps should be taken to tackle the upcoming economic crisis.

With signs of an impending recession, the government should work on providing job security to people. It should work on projects that could create jobs for the masses and control recession.

Small and medium enterprises (SMEs) should be taken care of. Government must focus upon the funding issues faced by these SMEs and also to newly emerging startups.

Agricultural sector needs a major boost. By maintaining proper purchase and sale of goods, the inflation rate of goods can be controlled. Further, peasants should also be given a suitable price for their produce.

The nation builders/laborer should be ensured of their jobs and financial security.

One could not expect a miraculous improvement in the economy. But everyone especially the Government should simultaneously be patient and alert in working towards the economic growth that had been hit bad due to coronavirus. A slow but progressive growth can be expected.

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