Economical impact of Covid-19

The name “corona virus” is derived from Latin corona, meaning ‘crown’ or ‘wreath’.
COVID-19 stands for: ‘CO’ for corona, ‘VI’ for virus, and ‘D’ for disease. Well, it was
named first as ‘2019 novel corona viruses. This virus is linked to the severe acute
respiratory syndrome (SARS) which is the other or mostly the same types of cold. The
world health organization declared COVID-19 a global pandemic on the 11 th of March
2020 but the world is still reeling and managing from its aftermath. Originating from
China, cases quickly spread across the globe, which prompted the implementation of
strict measures to be undertaken by the world governments to limit the cases and the
transmission of the virus. This has however shattered the sustaining pillars of the
modern world economies.

How this pandemic changed the world scenario is disastrous and ruinous. This virus
has reached and spread to maximum countries in the world. If we talk in economic
context, the impact is gloomy and defeatist. Aviation and Tourism industries are highly
affected by this epidemic. If we talk about figured and numerical values; Aviation and
Tourism sector contributes to our GDP about 2.4% and 9.2% respectively. Most
significantly 43 million people depend on it for their source of livelihood. In the latest
broadcast, this was the first industries which were hit badly by this pandemic.

Oil & Gas industry in India is significant as it stands the third largest energy consumer
behind USA and China which contributes to approximately 5.2% to our country’s GDP.
The complete lockdown proved to be severe and it slowed down the transport of fuels.
Food and Agriculture-Unemployment is said to be the building block of our country and
the essential commodity. COVID-19 has lead to the agricultural industry where several
workers lost their employment. Farmers, suppliers, clerical staff all have been duly
affected because there were very less business houses that were able to cope with the
destructive and challenging changes of the pre and post lockdown period.

Lack of production is the another concern, in the lockdown period in particular

geographical measures agricultural works were required to stay at their respective
homes except for when to acquire the essential commodities. A full time stay-at-home
means there is little or no crop production which is being taken place. Demand and
Supply conditions were volatile which made agriculturalists to analyze very crucially
their current method for production and adapt to challenging methods in these times
which made them left with no other alternative choice.

Apart from this, as per our Ministry of Statistics , India’s growth in the fourth quarter of
the fiscal year went down to 3.1 % Where the chief economic adviser to the government
of India said that this drop is mainly due to the pandemic which has largely affected the
Indian economy.

 From March 2020 there has been global recession and cause had been
COVID-19 pandemic induced market stability and lockdown. Impact of
the same has been in result of
 Largest GDP contraction ever.
 Sharp rise in unemployment
 Stress on supply chains
 Decrease in government income
 Collapse of the tourism industry
 Collapse of the hospitality industry
 Reduced consumer activity
 Trade tensions with China
 Plunge in fuel consumption, Rise in LPG sales.

The World Bank had initially revised India’s growth for the fiscal year2021 with the
lowest figures India has seen in three decades since India’s economic liberalization in
the 1990s. However, after the announcement of the Economic package , the estimate
has been made of India’s GDP will be downgraded to even more negative pessimist
figures which is giving us a hint or signaling of deep recession. As per India business
resumption index economic activity fell from 82.9 to 44.7. Unemployment rose from
6.7% to 26%. During the lockdown, It has been estimated that around 14 crore people
have lost their jobs while salaries were cut for maximum of others. More than 45% of
households across the nation have reported an income drop. The Indian economy was
expected to lose over Rupees 32,000 crore (4.5 billion $) every day during the early
months of pandemic lockdown which was declared following the ‘Corona virus
outbreak’.

Impact of COVID-19 on world economy:

We talked about Indian economy however not only the Indian but the global and world
economy had been affected devastatingly. The global economy outlook during this
pandemic, we can face a changed world. This worldwide epidemic has spread with an
alarming speed, infecting millions and bringing everything to a halt as countries imposed
tight restrictions on the movement to control the spreading.

The economic damage is explicitly seen and represents the largest economic damage
the world has experienced in the decades. The deep recessions by the pandemic are
expected to leave the scars through lower investment, an erosion of human resource
through the lost of work (unemployment) and schooling. The crisis highlighted the need
for necessary actions that needs to be taken to curb the economic consequences.
The pandemic is expected as per the latest reports to make most of the countries fall
into recession (some have been already fallen) with per capita income contracting in the
largest fraction of countries globally since 1870. There is an unprecedented collapse in
oil demand and a crash in oil prices. Businesses might find it hard to service debt,
heightened risk aversion which could lead to climbing of borrowing costs and
bankruptcies which will result in financial crisis in many countries.

Hence, The COVID-19 recession has seen the fastest, steepest downgrades in the
consensus growth projections among all global recessions since 1990. This global
recession is bound to taken on economies with extensive sectors that make up an
approximate of 1/3rd of the GDP and about 70% of the total employment in the market
which are emerging and the economies which are developing.

In the conclusion, the global cooperation of the measures is needed to make the spread
of pandemic slow and the economic actions are necessary to eliminate the economic
damage. International support provides the greatest chance of achieving public health
goals and enabling a fast global recovery.