Impact of COVID 19 on global and Indian Economy

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by Biotech Express Bureau

If you are interested to find how market projections changed during CoV pandemic then you may see many financial advisors’ websites or reports but the aim of this article revolve around the aim to see how a biological agent can hit the economies of many countries including world leaders like America and China.

Success in biological containment of the virus had come at the price of slowing economic activity, no matter whether social distancing and reduced mobility are voluntary or enforced. The coronavirus shock is severe even compared to the Great Financial Crisis of 2007–08, as it is hitting households, businesses, financial institutions, and markets all at the same time—first in China and now globally.

J.P. Morgan Global Economics Research now expects the global economy to experience an unprecedented contraction during the first half of the year as containment measures are driving deep collapses in monthly economic activity.

The FTSE, Dow Jones Industrial Average and the Nikkei have all seen huge falls since the outbreak began on 31 December. The Dow and the FTSE recently saw their biggest one day declines since 1987. Similarly many industrial segments have recorded record decline in demand and supply.

The analysis by the UN Department of Economic and Social Affairs (DESA) said the COVID-19 pandemic is disrupting global supply chains and international trade. According to the forecast, lockdowns are hitting the service sector hard, particularly industries that involve physical interactions such as retail trade, leisure and hospitality, recreation and transportation services.The analysis also warns that the adverse effects of prolonged economic restrictions in developed economies will soon spill over to developing countries via trade and investment channels. A sharp decline in consumer spending in the European Union and the United States will reduce imports of consumer goods from developing countries.

In response, central banks in many countries, including the United Kingdom, have slashed interest rates. Global markets did also recover some ground after the US Senate passed a $2 trillion (£1.7tn) coronavirus aid bill to help workers and businesses.

Industries that were hit hard due to this biological calamity
The Hospitality industry hotel, restaurant industry has been badly damaged, with airlines cutting flights and tourists cancelling business trips and holidays. All means of public transport like airbus, rail, buses, autos and even rickshaws have been banned on their tracks. This not only affected the drivers but also the families who were looking to welcome the passengers they are bringing in their tourist city.Governments around the world have introduced travel restrictions to try to contain the virus.

There is a long list of other industries that have suffered a lot after Coronavirus attack. The list include Education, Sports & Entertainment, Hyperlocal Marketplaces, Retail & e-Commerce, Fintech, Textile and Apparel, Consumer Durables and Electronics, Poultry and Seafood, Movie theatres, Fitness centers, Commercial real estate, Shipping, Automakers, Oil and gas, Conventions, Online Food service, Theme parks etc.

Since there are many industries that have been put in a dormancy state it is noteworthy to discuss the industries that are kept in a list of essential commodity and are open.

The first priority has been granted for food and health sector, including their upstream/downstream partners. Second priority was given to online marketplaces that are providing essential commodities like supermarkets and online delivery services have reported a huge growth in demand as customers stockpile goods such as toilet paper, rice and orange juice as the pandemic escalated.

Since the number of COVID19 cases did not surge to extreme, Indian Govt. on 17th April i.e. after 25 days of lockdown allowed few industrial activities to resume/boost India’s financial position.

Industries open during lockdown 2.0 India
All kinds of essential include all health workers — doctors, nurses, hospital staff, and sanitation workers.
All kind of Agriculture activities and its production and supply chain.
Online Educational activities.
Media persons belonging to print and electronic media but not in hotspots.
Homes of children, disabled, mentally challenged or senior citizens, women
Movement, loading or unloading of goods cargo — both inter or intrastate
MNREGA works are allowed with strict implementation of social distancing and use of face mask.
Hotels, homestays, lodges and motels, which are accommodating tourists and persons stranded due to lockdown, medical and emergency staff, air and sea crew
Services provided by self-employed people, including electrician, IT repairs, plumbers, motor mechanics and carpenters
Industries in rural areas, SEZs, and EOU zones, units making essential goods, food processing units, IT hardware companies, coal production will be allowed to function.
Construction of roads, irrigation projections, buildings and all kinds of industrial projects, including MSMEs, in rural areas and construction of renewable energy projects will be allowed.
The government will also ease restrictions for farmworkers since the rabi crop harvest season has started in states like Punjab, Haryana and Uttar Pradesh. This include Shops of agriculture machinery, its spare parts (including its supply chain) and repairs to remain open.
All security personnel, including police and security forces, are also exempted from the lockdown.
All kinds of essential service agencies, including cook gas agencies, fuel pumps, ration shops, wholesale and retail shops and vegetable mandis, will remain open.
Pathology labs will also be allowed to operate amid the lockdown. Notably, the government has also roped in various private labs to conduct COVID-19 tests.
All Goods traffic like Goods trucks carrying goods — weather or not essential goods — within states and outside states will be allowed to operate during the extended lockdown period.
People in areas not identified as containment zones are allowed to go out to buy essential items like ration, vegetables, milk, etc.
IT services for essential services, internet and telecommunication services will also remain open.
Postal Services.
Delivery of all essential goods including food, pharmaceuticals, medical equipment through E-commerce.
Capital and debt market services as notified by the Securities and Exchange Board of India.
Cold storage and warehousing services.
Data and call centers for Government activities only.
All other establishments may work-from-home only.

Industries still closed after lockdown 2.0 India
All domestic and international air travel for the general public; all passenger trains; bus transport; and metro rail services will remain closed.
Taxis, including auto-rickshaws and cycle rickshaws, and services of cab aggregators will not operate during the extended lockdown.
All social, political, sports, entertainment, academic, cultural and religious activities also stand suspended.
All religious places of worship will be closed for public during the lockdown. In the case of funerals, the congregation of more than 20 persons will not be permitted.
To mitigate hardship, select additional activities have been allowed from April 20. However, states or UTs will separately take the final call on the relaxation of curbs. PM Modi on Tuesday had also said that areas with no coronavirus cases could be exempted some restrictions from April 20.
All education institutes will remain shut.
All social, political, sports, cultural, academic, entertainment and religious gatherings are prohibited.

References:
1. https://economictimes.indiatimes.com/news/economy/policy/how-different-sectors-of-the-economy-are-bearing-the-brunt-of-the-coronavirus-outbreak/articleshow/74630297.cms?from=mdr
2.https://www.usatoday.com/story/money/2020/03/20/us-industries-being-devastated-by-the-coronavirus-travel-hotels-food/111431804/

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