Economics of Covid

Covid’19 has dropped the building blocks of the Indian economy. None of the nations had prepared for this sort of a fatal contagion and economic downturn rolled into one. Covid’19 has sparked massive dislocation of economic activities, especially the global supply chain, trade, travel, tourism, hospitality, entertainment, aviation etc. The measures like social distancing and complete lockdown of economy, necessarily undertaken to control the spread of the virus and to prevent loss of life due to Covid’19, hindered economic activities which forced the closure of many businesses. However, internet-based businesses like online entertainment, online shopping and food delivery experienced unprecedented growth in this pandemic.

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During the pandemic, retailers and brands faced challenges, like reduced consumer demand, low sales and profitability, uncertain cash flow, staggered supply chain and so on. All business enterprises no matter how established they are needed to reassess their business plan to manage and operate their business prudently in the time of crisis, to keep their business moving during the lockdown period and post covid period.

Lockdown period impacted inversely to the economic activity of India which fell from 82.9 to 44.7 index according to Nomura India Business Resumption Index. Unemployment in India rose from 6.7% to 26%.  14 crore people lost their employment while others faced remuneration cuts. 45% of the families across India confirmed an income drop from the previous year. 53% of the entrepreneurs of the country were severely affected and the Indian economy lost Rs. 32000 crore every day during the period of lockdown. New start-ups were impacted immensely due to the unavailability of funding at the initial stage. Stock markets reached to the worst point in the history of India and many Corporate players like Tata Motors, ICICI Bank, Hindustan Unilever, Bajaj, Ultra tech Cement suspended their operations.

The Government of India announced various plans and programs like ‘Self Reliant India’, economic packages, vaccination drive, and others to handle the situation. In the scenario that the world faces today, we can expect a V-shaped recovery for India after this disaster, as various economic indicators showed significant improvement in the current period.

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