ECONOMIC IMPACT OF COVID 19 IN UTTAR PRADESH.

The research paper submitted in complete fulfillment of the course Micro Economics for
obtaining the degree B.A. L.L.B. (Hons.) during the academic session 2020-2021.

Submitted by

Dakshita Dubey

Roll No. - 2117

Submitted To:

Dr Shivani Mohan

Asst Professor of Economics

October, 2020.

Chanakya National Law University,

Nyaya Nagar,

Mithapur,

Patna, 800001.
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DECLARATION BY CANDIDATE

I, DAKSHITA DUBEY, student of Chanakya National Law University hereby declare that the
work reported in the B.A.LL.B. (HONS.) Project report entitled: ECONOMIC IMPACT OF
COVID 19 IN UTTAR PRADESH submitted at Chanakya National Law University, Patna is
an authentic record of my work carried out under the supervision of Dr Shivani Mohan. I have
not submitted this work elsewhere for any other degree or diploma. I am responsible for the
contents of my Project Report.

NAME: Dakshita Dubey

ROLL NO: 2117

COURSE: B.A. LL.B. (Hons.)

SEMESTER: 2020-2021 (3rd).

3|Page

ACKNOWLEDGEMENT

I would like to thank my faculty of Micro Economics, Dr Shivani Mohan, whose guidance
helped me a lot with structuring of my project. I take this opportunity to express my deep sense
of gratitude for her guidance and encouragement which sustained my efforts on all stages of this
project.

I owe the present accomplishment of my project to my friends, who helped me immensely with
materials throughout the project and without whom I couldn’t have completed it in the present
way.

I would also like to extend my gratitude to my parents and all those unseen hands that helped me
out at every stage of my project.

THANK YOU

NAME: Dakshita Dubey

ROLL NO: 2117

COURSE: B.A. LL.B. (Hons.)

SEMESTER: 2020-2021 (3rd)

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TABLE OF CONTENTS

INTRODUCTION......................................................................................................................... 5

RESEARCH METHODOLOGY ................................................................................................ 7

Aims and Objectives .................................................................................................................... 7
Hypothesis ................................................................................................................................... 7
Sources of Data ........................................................................................................................... 7
Limitations .................................................................................................................................. 7
Mode of Citation ......................................................................................................................... 7

COVID 19 HAS INCREASED THE UNEMPLOYMENT RATE OF UTTAR PRADESH . 7

IMPACT OF COVID-19 ON MIGRANT LABOURERS OF UTTAR PRADESH ............. 11

IMPACT OF COVID 19 ON THE TOURSIM SECTOR ....................................................... 14

CONCLUSION AND SUGGESTIONS .................................................................................... 16

BIBLIOGRAPHY ....................................................................................................................... 16
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INTRODUCTION
The outbreak of COVID-19 has impacted nations in an enormous way, especially the nationwide
lockdowns which have brought social and economic life to a standstill. A world which forever
buzzed with activities has fallen silent and all the resources have been diverted to meeting the
never-experienced before crisis. There is a multi-sectoral impact of the virus as the economic
activities of nations have slowed down.1

The International Labour Organization in its report describes the coronavirus pandemic as ‘the
worst global crisis since World War II’. About 400 million people (76.2% of the total workforce)
working in the informal economy in India are at risk of falling deeper into poverty due to the
catastrophic consequences of the virus. As half of the world is in lockdown, it is going to be a loss
of 195 million full-time jobs or 6.7 percent of working hours globally. Many are in lowpaid, low-
skilled jobs where sudden loss of income is catastrophic (International Labour Organisation,
2020).2

In January 2020, India reported its first case of COVID-19, and by May 26 2020, the number of
people affected had risen to more than 145,000 and there had been almost 4,200 deaths.4 In
response, the Government of India instituted a 21-day lockdown on 24 March 2020. This was one
of the world’s strictest, suspending most economic activities, maintaining just basic services and
only keeping open shops that provided essential consumption goods. One month later in an effort
to protect the economy, the Government relaxed the measures in less-affected regions and on 29
April, allowed inter-state movement of people, mainly migrant workers. 3

India now has over 100,000 covid-related deaths, and there have been no sustained signs of a let-
up so far. Yet, September was the first month with positive hints of an economic recovery.
Growing activity despite the pandemic shows the restrictions may simply have worn Indians out

1
Monika Chaudhary , P. R. Sodani and Shankar Das, Effect of COVID-19 on Economy in India: Some Reflections
for Policy and Programm, https://journals.sagepub.com/doi/pdf/10.1177/0972063420935541, (accessed on 25-10-
2020).
2
International Labour Organisation (ILO), Rapid Assessment of the Impact of the COVID-19 Crisis on Employment,
https://www.ilo.org/wcmsp5/groups/public/---asia/---ro-bangkok/---sro-
new_delhi/documents/publication/wcms_748095.pdf , (accessed on 25-10-2020).
3
Johns Hopkins, Coronavirus Resource Centre, https://coronavirus.jhu.edu/map.html, (accesed on 26-10-2020).
6|Page

by now. As the economy crawls back to life, precautions against the virus will be key to keep the
engine moving.

Six states make up half of India’s economic output, and will matter the most in economic recovery:
Maharashtra, Tamil Nadu, Uttar Pradesh, Karnataka, Gujarat, and West Bengal. Until recently,
economic revival in India was mostly limited to smaller states. The lingering impact of the
pandemic was still felt in larger, richer states. But that trend is now reversing. In September,
workplaces in these states recorded 69% of their normal footfalls, shows Google data. This is the
highest since the lockdown began in March. The rest of India recorded 78% of the normal footfalls
at workplaces, the worst level since May, as cases spread faster in the smaller states. 4

4
Tanay Sukumar, Pooja Dantewadia, State Recovery Tracker: High-GDP states catch up with rest of India on
economic revival, https://www.livemint.com/news/india/high-gdp-states-catch-up-with-rest-of-india-on-economic-
revival-11601880937917.html, (accessed on 26-10-2020).
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RESEARCH METHODOLOGY
The researcher has adopted purely a doctrinal method of research. The researcher has made
extensive use of the books and internet sources. The doctrinal research helps in comparative
study of the topic.

Aims and Objectives

The researcher’s aims & objectives are as follows:

1. The researcher tends to analyze that how this pandemic has affected the economy of Uttar
Pradesh.
2. The researcher wants to analyze affect of this pandemic on the people of Uttar Pradesh.

Hypothesis
1. Covid-19 pandemic has increased the unemployment rate of Uttar Pradesh.
2. The migrants of Uttar Pradesh were badly affected by the Covid-19 pandemic.
3. The tourism sector has been affected drastically due to the pandemic.

Sources of Data
The researcher is using secondary sources of data.

Limitations
The researcher had physical limitations as well as a definite period of time while compiling this
research work.

Mode of Citation
The researcher will follow Blue book (19th edition) for completing the project.

Scheme of Writing
Part I of the project work deals with the introductory portion of the project which gives a brief
background of the product, from the 21 day lockdown to some of the major effects that the
pandemic had nationally.

Part II of the project work, revolves around the Research Methodology. In this section, the author
has dealt with the aims and objective and other prerequisites of the Research work. The Author
8|Page

has substantiated the hypothesis, and Source of Data Collection, and also has in brief reviewed the
literature in the context of this research work.

Part III of the project work deals with the unemployment rate’s surge during Covid 19 in Uttar
Pradesh, it does so, by analyzing reports by International Organizations, Statutory bodies as well
as news agencies. It also presents a comparative study of figures from previous years to the present
scenario.

Part IV of the project work deals with the migrant workers of Uttar Pradesh who were badly
affected by the pandemic as the Lockdowns were improperly planned, they lost their constant
source of income and had no transportation whatsoever to reach back home.

Part V of the project work deals with the tourism sector of Uttar Ppradesh, as the state is home to
a lot of tourist destinations, including one of the Seven Wonders of the world, the Taj Mahal. It
deals with the problems and the ways the sector dealt with Covid-19.

Finally, Part V deals with the Conclusion of the entire research work. The author in the section,
summarized the findings and the concluded the research work. The author has also provided few
suggestions for the state to deal with the pandemic in a better manner.
9|Page

COVID 19 HAS INCREASED THE UNEMPLOYMENT RATE OF UTTAR

PRADESH
The International Labour Organization in its report describes the coronavirus pandemic as ‘the
worst global crisis since World War II’. About 400 million people (76.2% of the total workforce)
working in the informal economy in India are at risk of falling deeper into poverty due to the
catastrophic consequences of the virus. As half of the world is in lockdown, it is going to be a loss
of 195 million full-time jobs or 6.7 percent of working hours globally. Many are in lowpaid, low-
skilled jobs where sudden loss of income is catastrophic (International Labour Organisation,
2020).5

Uttar Pradesh's unemployment rate increased 11.4 percentage points, rising to 21.5% in Apr 2020,
according to a survey conducted by the Centre for Monitoring Indian Economy (CMIE). Over a
longer time period, unemployment has moved from 2.1% in Jul 2017 to its current rate.

Uttar Pradesh's unemployment rate increased 11.4 percentage points, rising to 21.5% in Apr 2020,
according to a survey conducted by the Centre for Monitoring Indian Economy (CMIE). Over a
longer time period, unemployment has moved from 2.1% in Jul 2017 to its current rate.
Unemployment in Uttar Pradesh was less than than the national rate of 23.5%. Nationwide,
unemployment was highest in Tamil Nadu, Jharkhand, and Bihar at 49.8%, 47.1%, and 46.6%

5
Chaudhary et al, Supra at 1.
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respectively. It was lowest in Punjab, Chhattisgarh, and Telangana at 2.9%, 3.4%, and 6.2%
respectively.6

Unemployment rate in the country softened to 7.19 per cent in August from 8.21 per cent in July,
with urban unemployment rate moderating to 8.73 per cent from 9.43 per cent and rural
unemployment rate easing to 6.47 per cent from 7.66 per cent, data from the Centre for Monitoring
Indian Economy (CMIE) showed.7 The data indicates unemployment rate moderating to the pre-
lockdown level in March with the economy opening up gradually after the un-lockdown measures

Overall unemployment rate eased to 7.43 per cent in July from a double-digit level of 10.99 per
cent in June, with both urban and rural unemployment rates recording a moderation. Urban
unemployment rate in July eased to 9.15 per cent from 12.02 per cent in June, while rural
unemployment rate eased to 6.66 per cent from 10.52 per cent in June. 8

Currently, there are about 34.51 lakh registered jobless persons on the state government’s
integrated employment portal. A total of 75,865 people registered themselves on the portal from
April 1 to July 15. Director, training and employment department, Kunal Silku said the rising
number of registrations on the portal did not indicate increasing unemployment as people often
used the portal not only to seek jobs but also to switch jobs.9

6
Mint Analytics, Unemployment in Uttar Pradesh increased 11.4 pct points, rose to 21.5% in Apr 2020: CMIE
Survey, https://www.livemint.com/news/india/unemployment-in-uttar-pradesh-increased-11-4-pct-points-rose-to-21-
5-in-apr-2020-cmie-survey-11588316047392.html, (accessed on 27-10-2020).
7
https://unemploymentinindia.cmie.com, (accessed on 25-10-2020).
8
ENS Economic Bureau, Unemployment rate eases to 7.19% in week ended Aug 2: CMIE,
https://indianexpress.com/article/business/unemployment-rate-eases-to-7-19-in-week-ended-aug-2-cmie-6537857/,
(accessed on 25-10-2020).
9
Umesh Raghuvanshi, Over 75,000 people registered on UP govt job portal from April to July,
https://www.hindustantimes.com/lucknow/over-75-000-people-registered-on-up-govt-job-portal-from-april-to-
july/story-b5s6l4IjoKJWmo8IilAJIK.html, (accessed on 27-10-2020).
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IMPACT OF COVID-19 ON MIGRANT LABOURERS OF UTTAR

PRADESH

Epidemics not only pose a public health crisis, but often convert into an economic crisis and a
migration crisis too. In epidemic conditions, a large number of internal migrant workers are
trapped in cities after being laid off due to the measures taken by the government to control the
spread of the disease. Most of these workers earn little more than a subsistence wage and have no
other means to protect their incomes if they lose their jobs.

This issue drew attention of the administrators and researchers when it was noted that after the
announcement of the 21-day-country-wide lockdown due to COVID-19 in India, there was a
sudden gathering of tens of thousands of migrant workers from across the city of Delhi, walking
towards bus terminals to cross into Uttar Pradesh, Bihar and other states. They gathered in
thousands being desperate to reach their hometowns in adjoining states. With most transport links
shut down, many were trying to walk hundreds of kilometers back to their rural homes with their
families.

Internal migrants form a crucial part of India’s economy. The Economic Survey 2016–2017
estimated that there are an estimated 100 million internal migrants in India, which make up about
20 per cent of the total workforce. They contribute an estimated 10 per cent of India’s economic
output and play an important role in the economy of the country. Many of the internal migrants
travel from poorer states such as Bihar and Uttar Pradesh in the north to work in the industrial hubs
of more developed states like Gujarat and Maharashtra in the south, or to the metro cities. 10

10
Tish Sanghera, Hungry, desperate: India virus controls trap its migrant workers,
https://www.aljazeera.com/economy/2020/04/02/hungry-desperate-india-virus-controls-trap-its-migrant-workers/,
(accessed on 27-10-2020).
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According to Census 201111, there were around 65 million migrant workers working in various
occupations, excluding cultivators and agricultural labourers (Table 1). The analysis of non-
agricultural migrant workers according to occupational category shows that a large proportion of
them are engaged in craft and related trades or as plant and machine operators and assemblers. The
migration data of Census 2011 also indicated that a large number of migrants are arriving in
different urban areas, particularly metro cities from different states. In Delhi, around 39 per cent
of the migrants came from Uttar Pradesh alone. 12

A mass departure of migrant workers from cities in several states to their villages raised concerns
that the COVID-19 outbreak could turn into a humanitarian crisis. Realizing the gravity of the
problem, the government launched a new scheme, namely Migrant Workers Return Registration.
This scheme’s main motto is to count the number of daily labourers and migrant workers who got
stuck in other states, as well as to provide them with 14 days of quarantine facilities and
arrangements after they reached their hometowns. State governments across the country launched
their portals and accumulated the data of their people (daily labourers and migrant workers), so
that they could be shifted to their hometowns easily. A large number of buses were arranged for
their interstate movement. The Indian Railways also introduced Shramik special trains for the
relocation of migrant workers, tourists, pilgrims, students and others. 13

The State of Uttar Pradesh has announced to set up a commission to look into the welfare of these
workers besides conducting skill mapping. It is to be seen as to which extend the plight of these

11
Census . (2011). D-series migration tables. Office of the Registrar General & Census Commissioner, Ministry of
Home Affairs, Government of India. New Delhi.
12
Anoop Khanna, Impact of Migration of Labour Force due to Global COVID-19 Pandemic with Reference to
India, https://journals.sagepub.com/doi/full/10.1177/0972063420935542, (accessed on 29-10-2020).
13
Ibid.
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workers is addressed in days to come. Moreover, in order to witness the greenshoots in our
economy, it is necessary that the industry and business should revive. It is not possible without
employing the migrant workers. 14

14
Anupriya Alok, Impact of COVID-19 on Migrant Workers: Issues and Challenges, International Journal of
Research and Review Vol.7; Issue: 7, https://www.ijrrjournal.com/IJRR_Vol.7_Issue.7_July2020/IJRR0016.pdf
(accessed on 29-10-2020).
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IMPACT OF COVID 19 ON THE TOURSIM SECTOR

The FICCI-Yes Bank report titled ‘India Inbound Tourism: Unlocking the Opportunities’
described India as a tourism powerhouse and the largest market in South Asia. Tourism in India
accounted for 9.2 per cent of GDP and had generated US$247.3 billion in 2018, with the creation
of 26.7 million jobs. Currently, it is the 8th largest country in terms of contribution to GDP.
According to the report, by 2029, the sector is expected to provide employment to nearly 53 million
people. Foreign Tourist Arrivals (FTAs) crossed 10 million in 2017. However, the Corona virus
pandemic has restricted international mobility and the revenues generated by this sector will take
a major toll on the GDP growth rate. It may bring a downfall of 0.45 per cent in the growth rate of
GDP.15

The Confederation of Indian Industry (CII) indicated that more than half of the tourism and
hospitality industry can go sick with a possible loss of large number of jobs if recovery in the
industry stretches beyond October 2020.16

The tourist traffic in Uttar Pradesh has taken a severe blow following the outbreak of the Covid 19
pandemic. Since the months of May-July are when domestic tourism peaks due to holidays in
schools and moderate weather conditions, the blow to tourism industry has been all the more
severe.

Agra, which is one of the biggest tourist destinations in the state, has recorded a more then 50 per
cent drop in tourist traffic.

According to Agra Tourist Welfare Chamber (ATWC), the city which is also known for its
footwear, handicraft, silver, etc. has recorded a decline of more than 60% in tourist traffic.
According to data provided by the Archaeological Survey of India, the number of foreign tourists

15
Chaudhary et al, Supra at 1.
16
Goutam Das, 136 million jobs at risk in post-corona India, https://www.livemint.com/news/india/136-million-
jobs-at-risk-in-post-corona-india-11585584169192.html, (accessed on 27-10-2020).
15 | P a g e

fell down to a mere 1,274 on Sunday. On any normal day, there are more than 20,000-25,000
visitors at Taj Mahal including both domestic and foreign tourists. 17

In Varanasi, the tourist traffic has also slowed down considerably. Devotees at the Kashi
Vishwanath temple are being asked to wash their hands, wear masks and use sanitizers before they
enter the temple. Most of the deities at the temples have also being given masks. Similarly, at
Kushinagar where Lord Buddha is believed to have attained ‘Nirvana’, the tourist footfall was not
even 10%.18

Mathura, which normally witnesses maximum tourist traffic in March when Holi celebrations take
place, has reported a 'damp season'.

"The ban on travel to India for a period of one month will have a cascading economic impact and
will lead to job losses in the entire hotel, aviation and travel sector. We estimate that it will lead to
direct loss of not less than Rs 8,500 crore," was a statement made by Indian Association of Tour
Operators (IATO) Secretary Rajesh Mudgill.19

Assocham Tourism and Hospitality Council Chairman Subhash Goyal said since the outbreak of
coronavirus, the aviation and tourism industries in India have been adversely affected.

However, recently in the month of September, keeping in mind World Tourism Day that falls on
27th September every year, the government decided to open the tourism industry once again with
the centre mandated precautions.

17
Business Standard, Corona virus hurts tourism sector in Uttar Pradesh; Agra records 50% drop,
https://www.business-standard.com/article/current-affairs/coronavirus-hurts-tourism-sector-in-uttar-pradesh-agra-
records-50-drop-120031600175_1.html, (accessed on 27-10-2020).
18
Abdul Alim Jafri, Covid 19 shakes tourism industry of UP, Agra records 60% drop in visitors,
https://www.newsclick.in/COVID-19-Shakes-Tourism-Industry-UP-Agra-Records-60%25-Drop-Visitors, (accessed
on 27-10-2020).
19
Business Standard, Corona virus may halt tourism, aviation; Visa suspension to cost Rs 85 bn,
https://www.business-standard.com/article/pti-stories/coronavirus-visa-suspension-may-cost-rs-8-500-cr-for-travel-
tourism-aviation-sectors-120031201060_1.html, (accessed on 28-10-2020).
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CONCLUSION AND SUGGESTIONS

Even before the Covid-19 crisis, India had been experiencing slower economic growth and rising
unemployment – problems that were dramatically worsened by the pandemic and the ensuing
lockdown. The number of workers vulnerable to the lockdown could reach 364 million or more,
including those in casual work, self-employment and unprotected regular jobs (lacking social
protection coverage). These workers could face cuts in working hours, layoffs, furloughs and
reductions in incomes, and for some, this could continue beyond the lockdown.

Building on the stimulus packages and other policy responses, economic recovery will require a
strategy that restores jobs and supports incomes of both enterprises and workers – re-establishing
supply lines and building back demand, while protecting the health, rights and incomes of workers
and their families, especially for migrant workers and those in the informal economy.

An epidemic is a problem that tests the ability of a nation to effectively protect its population, to
reduce human loss, to save the economy and to rapidly recover. 20 The Corona virus epidemic has
come with extraordinary, intense uncertainty. It is difficult to estimate how long and to what extent
will the impact of the epidemic be on the lives of people and economy of the country. The
government has to come up with a well-crafted strategy to deal with this crisis.

At the national level, greater coordination is required between government agencies separately
tasked with migration and health mandates. There is also a need to relook at the national migration
policies, which should accommodate the assistance and protection of migrants arriving from, or
faced with the prospect of returning to, the areas affected by health crises. Establishment of
resilient food systems could reduce food insecurity and the pressure to return to origin among
migrants. More research is required on the impact of health crises on migration, particularly in
distinguishing health from other motivations to migrate.

The novel Corona virus has introduced the novel concept of organizations and institutions across
the planet making mandatory ‘work from home’ policies. The policies are initiated to curb the
spread of the virus and propagate necessary social distancing so that employees aren't suffering

20
Rachaniotis, N. P., Dasaklis, T. K., Pappis, C. P. (2012). A deterministic resource scheduling model in epidemic
control: A case study. European Journal of Operational Research.
17 | P a g e

from crowded commutes and workplaces. At a time when the worldwide pandemic requires
proactive and aggressive defense, countries worldwide have adopted this formula.

Lastly, the crisis witnessed a horrifying mass exodus of such floating population of migrants on
foot, amidst countrywide lockdown. Their worries primarily were loss of job, daily ration, and
absence of a social security net. India must rethink on her development paradigm and make it more
inclusive. It also exposed the apathy of the employers besides exposing the apathy of the state as
well. Now it has become clear that the employers used these workers to get their work done without
making any provision for the future security of these workers. The State on the other hand has
colluded with these employers in not bothering about the security of them.

However, every crisis brings about a unique opportunity to rethink on the path undertaken for the
development of a human being, community and society. The COVID-19 pandemic has a clear
message for the Indian economy to adopt sustainable developmental models, which are based on
self-reliance, inclusive frameworks and are environment friendly.
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BIBLIOGRAPHY
Other Authorities

Census . (2011). D-series migration tables. Office of the Registrar General & Census
Commissioner, Ministry of Home Affairs, Government of India. New Delhi ......................... 11
https://coronavirus.jhu.edu/map.html ............................................................................................. 5
https://www.ilo.org/wcmsp5/groups/public/---asia/---ro-bangkok/---sro-
new_delhi/documents/publication/wcms_748095.pdf................................................................ 5
Websites

https://indianexpress.com/article/business/unemployment-rate-eases-to-7-19-in-week-ended-aug-
2-cmie-6537857/ ......................................................................................................................... 9
https://unemploymentinindia.cmie.com .......................................................................................... 9
https://www.aljazeera.com/economy/2020/04/02/hungry-desperate-india-virus-controls-trap-its-
migrant-workers/ ....................................................................................................................... 10
https://www.business-standard.com/article/current-affairs/coronavirus-hurts-tourism-sector-in-
uttar-pradesh-agra-records-50-drop-120031600175_1.html .................................................... 12
https://www.hindustantimes.com/lucknow/over-75-000-people-registered-on-up-govt-job-portal-
from-april-to-july/story-b5s6l4IjoKJWmo8IilAJIK.html ........................................................... 9
https://www.livemint.com............................................................................................................... 8
https://www.livemint.com/ ............................................................................................................. 6
https://www.livemint.com/news/india/136-million-jobs-at-risk-in-post-corona-india-
11585584169192.html .............................................................................................................. 12
https://www.newsclick.in/COVID-19-Shakes-Tourism-Industry-UP-Agra-Records-60%25-Drop-
Visitors ...................................................................................................................................... 12
Journals

https://journals.sagepub.com/doi/full/10.1177/0972063420935542 ............................................ 11
https://journals.sagepub.com/doi/pdf/10.1177/0972063420935541 ............................................... 5
https://www.ijrrjournal.com/IJRR_Vol.7_Issue.7_July2020/IJRR0016.pdf ................................ 11
Rachaniotis, N. P., Dasaklis, T. K., Pappis, C. P. (2012). A deterministic resource scheduling
model in epidemic control: A case study. European Journal of Operational Research,
216(1), 225–231 ........................................................................................................................ 14