The COVID-19 pandemic proved to be an unprecedented shock as it affected the global economy with a humongous force. The Indian Economy was left completely devastated by the perilous state the pandemic had left us. With the lockdown that kept the country in a state of inactivity, this proved to be a disruptive act for the Indian economy.
Unparalleled economic blow
On March 24, India was hit with a nationwide lockdown. Unlike in other countries, the lockdown did have any extreme effect on India. The disease kept spreading despite being on strict lockdown.
The abrupt nationwide lockdown imposed across India was the biggest anyone had ever faced in the world. The lockdown restrictions were rained down without any preparation or coordination with states. It was also one of the strictest lockdowns enforced across the world.
The lockdown had some dangerous impacts on an economy that was already slow. People’s livelihood was upended as shops, eateries, factories, transport, services, and business establishments were shuttered.
According to official data released by the Ministry of Statistics and Programme Implementation, the Indian economy had crashed to 23.9%. this was the worst recorded decline since 1996, when India had started keeping GDP track record.
Domestic economic problems:
On June 8, based on a John Hopkins University’s dashboard, India was placed on seventh position to record the greatest number of affected coronavirus cases. The confirmed cases were a massive 258,090 and 7,263 recorded deaths.
An approximate of 84% of Indian houses were facing monetary issues since the lockdown. This data was according to a study done by the Universities of Pennsylvania and Chicago, and Centre for Monitoring the India Economy, Mumbai. The study had also found out that the pandemic had caused a hugely negative impact on the Indian household.
In response to the pandemic:
The study had also stated that direct and immediate transfers of food and cash are of very high priority when it comes to responding to the people in the face of the coronavirus pandemic. These kinds of transfers had to be broad-based and should reach out most of the income distribution.
It was obvious that the victims required additional resources so that they could survive. CMIE had found out that in nearly 5800 households across 27 Indian states in the last two weeks of April, expected that they might soon run out of money.
They had based these foundings on top of other search results including per-capita household income, and rural-urban classifications.
The end result of all studies that were conducted on the Indian economy before and after the pandemic was clearly put as –
- Managing the pandemic and the resultant public health crisis through thorough augmented financial resources, rise in insurances, and technological solutions.
- Protecting the income and employment rise in India, in particular, for the more vulnerable and lower sections of the society was paramount. By implementing direct cash transfers that are supported by adequate monitoring and evaluation mechanisms, utilizing existing digital payment infrastructures.
- Supporting the corporate sector to minimize adverse economic impact and facilitate recovery quickly through immediate and medium-to-long measures that help reposition India in the world’s global value chain.