Impact of Covid-19 on the Indian Economy

The economic and social impact that Covid-19 had on the Indian economy is magnanimous. It is undeniable that within the past few months, the world has changed radically due to the pandemic. When the World Health Organization officially declared Covid-19 to be a pandemic on March 11th 2020, the events followed can only be described as nothing short of tumultuous. This state of confusion and uncertainty has put a pause on life as we know it. Indian economy underwent a nationwide lockdown that severely affected the productive sectors and growth of the economy.

Critical factors had to be analyzed on a large scale, 2such as economic conditions and income, medical availability, food and water security, human rights etc. Although it is difficult to respond to such a situation pragmatically, it is essential to ensure containment measures and GDP growth. The United States initially responded to the pandemic with several lockdowns in different states. The capital city of India, New Delhi, has also declared the covid-19 outbreak as critical and imposed a lockdown on a large scale that had a substantial economic impact. Prime Minister Narendra Modi took quick action and relief measures to contain the outbreak. Urban areas had more strict pandemic restrictions than rural areas due to population and transportation methods. Every country has countered the current circumstances with different approaches and mechanisms, some more peremptory than others. The cost-benefit analysis to meet the criteria and income for curbing the pandemic has been taxing on every level. Several lockdowns, social distancing, and masking protocols have also been put in place to ensure minimal contact between all communities.

Close to every aspect of our daily working life has been changed, especially in the case of income for migrant workers and daily wage earners. Quarantine and social distancing have been imposed, and this led to once a booming population on the roads to not a single person on the streets. Due to the rising Covid-19 cases, public health was of great concern because of the extensive recovery process and hospitals getting overcrowded quickly. Thankfully, the serum institute of India and companies like Bharat Biotech teamed up to curate a vaccine to help combat the virus.

The Reserve Bank of India has also tentatively projected the fiscal year of India with each wave of Covid and, according to the finance minister Nirmala Sitharaman, 2020 had the sharpest decline in India’s economy and growth. As per the official data of income released by the ministry of statistics and program implementation, the Indian economy contracted by 7.3% in the April-June quarter of this fiscal year. The global epidemic has worst hit the informal sectors of the economy. India’s GDP contraction during April-June could be above 8% if the informal sectors are taken into account. Investments and private consumption are the two most significant engines of India’s economic growth. All the major sectors of the economy were severely hit except agriculture. In this year’s union budget, Finance minister Nirmala Sitharaman announced a fiscal deficit target of 6.8% for 2021 to 2022. The World Bank has also been monitoring the Indian economy and records that due to the recent economic activity and economic recovery, growth and India’s GDP is projected to rise. Other areas such as South Asia and South Korea documented swift containment measures to decrease the number of cases, which was a success and helped preserve the country’s income.