COVID19 – Impact on Indian Economy and Way Ahead

The Indian Economy, as we all know, is divided into three major sectors-Agriculture, Industry and Service and due to the Coronavirus outbreak, the impact on these sectors here in India has been deplorable and alarming.

Agriculture Sector, which contributes to around 17.5% to the Gross Domestic Product (GDP) and nearly employs half of the population of our nation, has become a critical victim of the COVID 19. The Coronavirus induced lockdown created a break in the production-consumption cycles resulting in a double blow to the farmers.

How? Firstly– the unseasonal thunderstorms and hailstorms amid the COVID blues has damaged the standing crops of wheat, rice and pulses in the states of Punjab, Haryana, Bihar and Uttar Pradesh. These calamities have left farmers in financial stress and uncertainty about their future. Secondly– the harvested crops are now unable to reach their respective markets due to the non-availability of labour force and the logistics. With an inefficient and inadequate warehousing system, the cultivators now face a challenge of storing the harvest. With the growing woes of our magicians who produce their livelihood from the mud, Is this a massive agricultural crisis in the making?

Coming to the next important sector of our Economy- The Industrial Sector. The Industrial Sector and the Indian Markets are driven by the Chinese raw materials and products sourced from China. Therefore with about 40 days of lockdown in China – Our Industrial Units have faced severe predicaments. The manufacturing units, the textile industries, the tech industries, etc.- have been facing severe declines due to the demand and supply irregularities. With nationwide lockdown, there have been disruptions in the labour supply fostering the unemployment rates in our country. This might lead to inflationary pressure on consumers (like the hike in fuel prices in Delhi ). The Indian Markets which are dominated by the Chinese products have also drowned in this wave of Coronavirus leaving thousands of workers and households unemployed and their traders uninsulated from the outbreak. However, if we try to look at the silver lining during this pandemic – Can India become self-reliant?

Now, coming to the service sector, this sector too has felt the tremors of the pandemic with call centres shut; banking systems disrupted, among others.

In between all these things, the ones who are suffering the most are our “city makers” — daily wage construction labourers, street vendors, household help — because of their dual inability to stay at their rental places and to go back to their villages. The people who earned their sustenance by doing daily routine jobs are now in a state of deprivation of income and desperation of work.

There is a job drought with muted wages in the entire Economy. India, who was dreaming of becoming a global exporting nation has now received a significant blow with nearly 35% of export orders cancelled as reported by Mr SK Saraf- President of Federation of Indian Export Organisation. All of this has with questions like — Is India now on a slippery slope?

Now, What is the way ahead? Or What should be the modus operandi? With a plethora of issues to be addressed- The first step should be to diagnose all our impotence.

A continuous lockdown would only exasperate the financial crisis that is curtailing in our country. We now need to slowly and carefully open our Economy as we witness post 3rd lockdown period with intrusive tracking of every citizen.

Views Are Personal

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