Coronavirus outbreak was first reported in Wuhan,China on 31 December 2019. In India, the first case of covid-19 pandemic was reported on 30th January 2020. Covid-19 virus spreads all over the world. It is one of the most dangerous pandemic after the Spanish flu.Thousands of people died everyday due to covid-19. It's has been four month and still there is no specific treatment of it. According to the recent data,USA have confirmed a lots of patients of covid-19, it's around 1.34 million. In India, As of 10 May 2020,the ministry of health and family welfare have confirmed a total of 62,939 cases, 19,358 recoveries and 2,109 deaths in the country.
Before reading in detail about the impact, first let us study about coronavirus
Coronavirus is a large family of viruses that causes illness. It ranges from the common cold to more severe diseases like Middle East Respiratory Syndrome (MERS-Cov) and severe Acute Respiratory Syndrome (SARS-Cov). The novel coronavirus is a new strain of virus that has not been identified in human so far. WHO advice to take precautionary and preventive measures to the countries.
Impact of covid-19 pandemic on Indian economy
To come out against novel coronavirus, Indian government extended the date of lockdown to 17 May,2020. The first phase of lockdown of the country on 25 March to 14 April.Then it has been extended to 3 May which is considered as second phase. And In third phase lockdown extended by 14 days. During lockdown government permitted only necessary goods to be sold out and other items shop must be closed. Due to which Indian Economy goes down.
According to the survey, Covid-19 is having a 'deep impact ' on Indian economy. Over the coming months jobs are at high risk because firms are looking for some reduction in manpower. Over 122 million Indian lose their jobs in April 2020. India's unemployment rate is now at a record of 27.1% according to the Centre of Monitoring the Indian Economy (CMIE). The new data shows India's unemployment figures four times that of the US. Of the 122 million who have lost their jobs, 91.3 millions were small traders and labours. But a fairly significant number of salaried workers 17.8 million and self-employed people 18.2 million have also lost work. According to the World Bank's assessment, India is expected to grow 1.5 per cent to 2.8 per cent. And IMF projected a GDP growth of 1.9 per cent for India in 2020 because the global economy is affected by the covid-19 pandemic, the worst recession since The Great Depression in the 1930s.Also we can't ignore that the lockdown and pandemic hit several sectors including Ministry of Micro,Small & Medium Enterprises (MSME), hospitality, civil aviation, agriculture and allied sector.
Let us have a look at the sector-wise impact on Indian Industry
Most of the electronic being a final product or raw material imported from China and used in the electronic Industry. Due to the Chinese virus, government has ordered to stop unnecessary item's import or export. By which India's electronic Industry may face supply disruptions, production, reduction impact on product prices due to heavy dependence on electronics components supply directly or indirectly and local manufacturing. According to the recent survey, Exports of electronics goods in India decreased to 54.28 INR Billion in March from 83.81 INR Billion in February 2020.
Some Chemical plants have been shut down in China. Due to which raw materials supply restricted. So there will be restrictions on import. It was found that 20% of the production has been impacted due to the disruption in raw materials supply. China is a major supplier of Indigo that is required for denim. Business in India is likely to get affected so people securing their supplies. Also, stock has not been cleared due to national emergency as well as production rate goes down.
Coronavirus outbreak has impacted the business of cargo movement service providers. In India, Government has announced that only necessary items will be export or import. As well as ordered to lockdown the factory for some intervals. So that production of goods has been stopped. As per the source per day per vessel has declined by more than 75-80% in dry bulk trade from mid January.
It's impact on Indian companies will vary and depend upon the extent of the business with china. China's business no doubt is affected. However, current levels of the inventory seem to be sufficient for the Indian Industry. If the shutdown in China continues then it is expected to result is an 8-10% contraction of Indian auto manufacturing in 2020.
Despite being one of the top formulations of drug exporters in the world, the pharma Industry of India relies heavily on importers of bulk drugs. Due to the coronavirus outbreak, it will also be impacted.
Due to coronavirus outbreak, several garments/textile factories in China has halted operations that in turn affecting the exports of fabric, yarn and other raw materials from India.
Due to the coronavirus outbreak, the inflow of tourists from China, East Asia regions and rest of world to India will lose that will impact the tourism sector and revenue.
An outbreak of covid-19 impacted the whole world and has been felt across industries. The outbreak is declared as a national emergency by the World Health Organisation. In India the three major contributors to GDP namely private consumption, investment and external trade will all get affected. World and Indian economy are attempting to mitigate the health risks of covid-19 with the economic risks and necessary measures needed will be taken to improve it.
From the economy's point of view, the lockdown undoubtedly looks costly right now, but compared to the lives of Indian citizens, it is nothing.
Prime minister Narendra Modi, speech to the nation on 14 April 2020 at 10 am.
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