The COVID-19 pandemic is the first human disaster in 2020 and its impact is very disturbing. According to WHO, more than 200 countries have confirmed medical cases caused by a coronavirus. Economies of all the countries have been destroyed due to lockdown. Businesses across the world namely transportation, infrastructure, entertainment, etc have seen a worse impact. Various events like social gatherings, weddings have been postponed. Schools and colleges have been closed. The virus has disturbed the smooth functioning of various giants such as Amazon, Myntra, etc. All the countries are facing high death rates during this time.
Presently most of the world economies are facing the demand depression and high unemployment. Lockdown announced by our Prime Minister on 23 March 2020, would slow down the supply side, accelerating the slowdown future and decrease in the growth rate of the nation. There is a shift in the world economic markets as all the factories, restaurants, markets, colleges, universities, malls, shops were shut down. Fear of this virus among people has reduced the movements and gatherings of the individuals.
India faces a huge decline in growth rate and its revenues. For the first time, all sectors are projected to experience negative growth in 2020. Livestock, retail, wholesale, logistics, entertainment, gems and jewelry, tourism, and electronics faced a severe impact and will have medium to long term recovery. Other sectors like drugs and pharmaceuticals, textiles, and metals will have a short to medium-term recovery. The lockdown in India has a sizeable impact on consumption which is the biggest component of GDP.
Unemployment in all the sectors increased in 2020 as due to this lockdown many people lost their jobs while many employee’s salaries were cut down. So, this pandemic has increased the problem of unemployment and hence will further increase the problem of poverty in the country.
According to India Times, the worst impacted due to lockdown is the labor sector under the MGNREGA scheme 2005, as they are not provided jobs, and in India, most of the laborers are associated with the construction companies and daily wage earners. The unorganized sectors will also suffer a great downfall in the coming days as the employment rate is going down due to this pandemic and will further weak GDP of our country.
According to the Economic Times, the total electronic imports of India becomes 45% equal to that of China. India purchases around one-third of machinery and almost two-fifths of organic chemicals from China. India also purchases pharmaceuticals ingredients and mobile phones from China around 65 to 70% and 90% respectively.
Covid-19 has affected the supply chains of the world as the import and export have fallen in all the regions of the world and hence all the sectors of the economy. This will affect the major export countries and also the import countries. The global trade according to World Trade Organisation will fall up this year by 32% due to this pandemic.
The Government of India played an active role in the lockdown to tackle the situation from food security and extra funds for healthcare to sector-related incentives like subsidies given to small scale industries and tax deadline extensions. The government also announced several economic relief measures for the people who are below the poverty line.
This COVID pandemic seems to be unavoidable now. But how long it will impact the world will depend upon the safety measures taken to prevent it. The government will play an important role to help the small and medium-size industries by giving loans and flexible conditions to come back on track. India has to find a way to raise the demand size and neutralize the present conditions for the unorganized sectors and daily wage earners
