Impact of Covid-19 on Indian Economy and The World.

Corona Virus In India

India has been under lockdown phase 4 until May 31st with some relaxations. Prime Minister Mr. Modi announced a relief package of 20 lakh Crores INR for various sectors to propel economic growth on May 17. Some relaxations which were provided to Red, Orange and Green zone areas during the Lockdown 3.0 like opening of some of the individual shops of non-essential items were extended to Medium and small scale industrial sector, farm and trading sector. Malls, Cinemas, restaurants and places with probable high foot fall remained closed. India now is ranked third in the world in terms of coronavirus cases, after the US and Brazil.

The COVID-19 pandemic pushed economies into a Great pushback, which helped contain the virus and save lives, but also triggered the worst recession since the Great Depression. Over 75 per cent of countries are now reopening at the same time as the pandemic is intensifying in many emerging market and developing economies. Few countries have started to recover. However, in the absence of a medical assistance, the strength of the recovery is highly uncertain and the impact on sectors and countries are uneven.

The entire country remained under lockdown till May 31, 2020 followed by Unlock phase-1 from June 1 and June 14. Up to May 31, was the Lockdown 4. Earlier the Lockdown 3 was up to May 17, Lockdown 2 was upto May 3 and before that the Lockdown 1 was from March 22 to April 16, 2020. Prime Minister Mr.  Modi announced measures with some relaxations.  According to experts, this is being done to ensure that the Food Safety of India is protected as Rabi harvesting season is on anvil. PM Modi said detailed guidelines have kept in mind the needs of the informal sector and farmers. India now joins countries such as France, USA which are moving with the idea of unlock phases after extended lockdowns.

The Harsh Effects on World Economies

A high degree of uncertainty surrounds this forecast, with both upside and downside risks to the outlook. On the upside, better news on vaccines and treatments, and additional policy support can lead to a quicker resumption of economic activity. On the downside, further waves of infections can reverse increased mobility and spending, and rapidly tighten financial conditions, triggering debt distress. Geopolitical and trade tensions could damage fragile global relationships at a time when trade is projected to collapse by around 12 per cent.

This pandemic like no other will have a recovery like no other. First, the unprecedented global sweep of this crisis hampers recovery prospects for export-dependent economies and jeopardises the prospects for income convergence between developing and advanced economies. We are projecting a synchronised deep downturn in 2020 for both advanced economies (-8 per cent) and emerging market and developing economies (-3 per cent; -5 per cent if excluding China), and over 95 percent of countries are projected to have negative per ca-pita income growth in 2020. The cumulative hit to GDP growth over 2020–21 for emerging market and developing economies, excluding China, is expected to exceed that in advanced economies. Sooner or later this crisis will vanish and it has to because change is the undisputed law of nature. The only thing waiting for us after this epidemic is a shattering or rather say, a collapsing economy for many nations. We are fighting this pandemic together hence same should be our spirit in handling the ruptured economy. With confirmed case count for India crossing a million and more than 26000 deaths, all we can do is to get more strongly committed to all guidelines and suggested precautions by governments and health agencies worldwide.