As we all know COVID-19 cases in India increasing day-by-day and till now infected more than 13,000 persons in India and the death toll reaches 400. According to reports, the COVID-19 outbreak came at a time when India’s economy was already slowing.
In an economy where the unemployment rates were already at a 45-year high, the coronavirus pandemic will definitely slow the growth of the Indian economy.
With the intention to contain the spread of COVID-19 cases in India the prime minister, Narendra Modi has earlier announced a nationwide lockdown for 21 days but to control the situation PM Modi has extended the lockdown period until 3 May
A report came from the economic research department from the State Bank of India on Thursday which estimated the overall loss for FY21 at Rs 12.1 lakh crore for India.
Sectors affected by lockdowns
- According to the confederation of Indian Industry (CII) 20 million jobs might be lost if the tourism industry does not rebound by October.
- Around 9 million jobs impacted in the manufacturing sector.
- Due to COVID-19 lockdown, the automobile industry is staring at losses of over 13,000 crore and this will impact the Indian economy because the auto industry contributes around 7.5% to India’s overall GDP.
- In the aviation sector, 600,000 contractual jobs are at risk.
- The restaurant business reported a 35% fall.
- Real estate sectors are very heavily affected by lockdowns.
Effect of coronavirus in the Indian economy
In terms of imports, the dependence of India on china is very large. India’s total electronic imports account for 45%of china.
Around 90% of certain mobile phones come from china and around 70% of pharmaceuticals ingredients also come from China to India.
India imports 18% of its total goods from china. Therefore, we can say that due to Coronavirus the import dependence on China will have a significant impact on the Indian economy. So all we have to understand that it is not going to be so easy and the “impact of coronavirus in the Indian economy” has to be going very worse.
Economically speaking, India is faced today with perhaps its greatest emergency since independenceRaghuram Rajan ” Former RBI governor”
Raghuram Rajan says the reason behind the greatest emergency is the global financial crisis in 2008-09 was a massive demand shock but our workers could still go to work but its not possible in the pandemic coronavirus where everyone is lockdown at home.
India’s GDP growth rate to 1.9% in 2020 said IMF
- GDP – The total value of all goods and services produced in a country in one year is known as GDP.
- GDP gives information about the size of the economy and how the economy is performing.
- International Monetary Fund (IMF) said that India and China will be the two major countries, which will record positive growth in 2020.
In its latest edition of the world economy report, IMF has named India as the fastest growing and emerging economies of the world.
International Monetary Fund (IMF) forecasts India’s 2020 growth at 1.9% and the other being China, for which the IMF has projected a growth rate of 1.2%.
The IMF chief economist “Gita Gopinath” said that India’s growth rate in 2021 is projected at 7.4%, while of China at 9.2%, for the USA the projected growth rate in 2021 is 4.5% and for Japan 3%.
While the world bank estimates India’s growth at 1.5%-2.8% at FY21, slowest since economic reforms three decades back.
From all the facts, we can assume that the “impact of coronavirus in the Indian economy” is going to be very worse for everyone.