This post is a part of YKA’s dedicated coverage of the novel coronavirus outbreak and aims to present factual, reliable information. Read more.
COVID-19 is by far the most dangerous disease to hit the world economy adversely. Now, this disease is also impacting the economy of our country. Various business houses are being adversely affected due to COVID -19 lockdown put in place by the government. Due to this lockdown, various states of the country weren’t able to easily perform their daily task. The entire transportation system is completely disrupted in the country. The economy of India will go down sharply and the time taken to recover from this situation will be huge if any remedial measures are not taken promptly.
Adverse Impact Of COVID-19 And The Lockdown On Indian Economy
Only the essential commodities are available in the market and the supply side of the commodities is impacted hugely due to the lockdown.
Industries like automobiles, construction, oil and gas, petroleum, and steel are in a complete shutdown position. This makes our economy cripple down adversely. Exports and imports of these commodities are the great sources of revenue in our country.
The FMCG industries are running short of raw materials and this is why the cost of production increases and this impacts the prices of the essential goods. Better to say at very high prices the essential commodities are being sold in the market.
Luxury items are now completely out of demand and this makes the taxes to shoot up in the Indian economy. The reason is the government collects a maximum of its revenue from these items and currently these products have zero demand in the market. This is why after the lockdown is over India may have to face the situation of Fiscal deficit very nearly.
The railway is one of the prime sources for generating the maximum revenue of the government. But this source is also blocked to avoid crowded places and for maintaining the social distancing among the people of the country. Hence, the huge part of the government revenue is going in the loss for the past few months.
The GDP of our country os being expected to reach a 5% mark in the last quarter. But due to the complete lockdown, this GDP will fall below 4% and will impact our economy adversely. There will be more challenges if world trade is disrupted due to this factor.
This is why several challenges are awaiting our way as soon as the lockdown is over. The complete world, as well as the Indian economy, may have to face severe new types of challenges that they have never faced before. This is why the best option is to take some remedial measures before this complete downturn takes its shape very shortly.
The government must have to take some decisive actions to prevent any type of financial crisis or adverse situation in the future. So, let’s all hope for the best and let’s see what happens next. Don’t panic and stay at your home as per the directives.