Economic Crisis And The Pandemic!

 

COVID-19 has rapidly affected our day-to-day life, businesses, disrupted the world trade and movements. Identification of the disease at an early stage is vital to control the spread of the virus because it very rapidly spreads from person to person. Most of the countries have slowed down their manufacturing of the products. The various industries and sectors are affected by the cause of this disease; these include the pharmaceuticals industry, the solar power sector, tourism, Information, and electronics industry. This virus creates significant knock-on effects on the daily life of citizens, as well as about the global economy. Presently the impacts of COVID-19 in daily life are extensive and have far-reaching consequences.

During the current pandemic, the economic downturn has greatly affected people from the lower socio-economic class. The distressing media visuals of migrant labourers going to their native places from the cities on foot during the lockdown have been critically debated. Remittance of money to the home country, which many migrant Indian workers popularly do, is another way of poverty reduction, economic development, and an increase in GDP.  About $139 billion (₹ 1042500 crores) was remitted to low and middle-income countries of South Asia from countries of work (e.g. Middle Eastern countries) in the year 2019. The disruption caused by COVID-19 has had a significant impact on these remittance flows. Importantly, remittances are projected to fall by about 23% in India in 2020 to $64 billion (₹4,80,000 crores) in striking contrast to a growth of 5.5% and receipts of $83 billion (₹ 6,20,000 crores) seen in 2019. The World Economic Forum states that in the current pandemic situation, migrants stuck abroad trying to cope with the exigencies will compromise to the adverse circumstances, by taking up low wage jobs, live in poor working conditions, restrict spending, and thus, risk exposure to infections like the coronavirus. It has been projected that during the lockdown that was imposed across the country for more than 3 months resulted in a loss of over $4.5 billion (₹ 35,000 crores) every day during the lockdown.

India as well as other parts of the world is trying to cope up with the economic crisis brought by the Covid-19 pandemic. The present situation is exceptional situations and the global economy is suffering. Further as per the recent statement of the International Monetary Fund (IMF) recession is coming soon. Considering current prevailing situations, every leading country is imposing various restrictions on exports of essential items. Further countries are trying to sustain their economy by offering various economy relief packages. India recently announced 1.7-lakh crore reliefs to overcome the situations that are arising out of Covid-19. Such a huge budget is going to impact funds available with the union government. To manage the government’s financial position financial emergency may be inevitable. What happens when the financial emergency is declared is the topic of the future.

Amidst this crisis, certain countries have an edge over other nations while handling this crisis, due to fast response to testing of Covid-19 and emphasizing healthcare and global economy.

By: Hammy