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How Has COVID-19 Impacted The Indian Economy: A Sectoral Analysis

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This post is a part of YKA’s dedicated coverage of the novel coronavirus outbreak and aims to present factual, reliable information. Read more.

The economy is a very sensitive organism. – Hjalmar Schacht.

The coronovirus outbreak, which later turned into a pandemic, has adversely affected the stability of the economy of 150 countries — jeopardising their lifestyle, impacting business, and making us realise the assumption of common well-being that we had taken for granted.

India has been widely affected by this pandemic as well. Notably, India had been witnessing a pre-pandemic slowdown, and necessary measures taken by the government in the name of lockdown and induced market instability have only further magnified the pre-existing risks to India’s economic outlook.

1. As per the data released by the World Bank, India’s economy will shrink by 3.2% in financial year 2021.

2. As per a statement released by the Chief Indian Economist Of Goldman Sachs, the economic growth of India has been estimated at a low figure of only 1.6%.

Why Is The Indian Economy At A Downfall?

Taking into consideration their severe intensity, the governments at both Union and State level, commenced necessary action in the name of the lockdown due to which all economic activities came to a standstill. The governments’ only focus was on meeting the hyper demand of essential goods.

All major sectors i.e. primary, secondary and tertiary have been severely impacted.

Due to the coronavirus pandemic and military standoff, it has ultimately brought a severe jolt to the supply of essential raw materials used in the production of various products.

Sectorial Impact

1. Raw Materials And Spare Parts

China is India’s third largest export partner for raw materials such as organic chemicals, minerals fuels, cotton etc. Due to the coronavirus pandemic and increasing tensions between the two countries due to military standoff in Ladakh, it has ultimately brought a severe jolt to the supply of essential raw materials used in the production of various products.

2. Agriculture

There is hardly any manpower available for agricultural purposes in different States. The lockdown has manifestly made it difficult for farmers to take their produce for sale to the market.

3. Apparel and Textile

The apparel and textile industry has been adversely affected due to disruption in labour supply, unavailability of raw material, restricted demand, shortage of working capital due to limited movement of people, and decline in purchasing capacity.

4. Building and Construction

The construction industry is going to face a dual challenge of high-interest payments and lack of sales.

5. Automobile Industry

The industry will continue to face challenges due to lack of demand because of falling income levels and global recession.

6. Pharmaceuticals

Nearly 70% of active pharmaceutical ingredients in India are imported from China.

Due to a rise in consumer demand for pharmaceutical products and shortage of APIs to manufacture drugs, the pharmaceutical market is witnessing skyrocketing prices. For instance, the price of vitamins and penicillin alone has already seen a 50% surge.

7. Tourism

The tourism sector is one of the worst-affected sectors, with visas being suspended and tourist attraction places being shut indefinitely. The whole tourism value chain that includes hotels, restaurants, agents and operators is expected to face losses worth thousands of crores.

8. Aviation

The aviation industry will also be one of the worst-affected sector in the next 12 months, as it’s highly unlikely that people will travel for leisure apart from essential travel.

Nearly 600 international flights to and from India and 90 domestic flights have been cancelled for varying periods, leading to a sharp drop in airline fares, even on popular local routes.

Coronavirus: Know about the fares, you need to pay for evacuation flights
The aviation industry will also be one of the worst-affected sector in the next 12 months, as it’s highly unlikely that people will travel for leisure apart from essential travel.

9. Banking Sector

Liquidity is expected to remain tight as the cost of borrowing in real terms will jump upwards. This is despite the Central bank’s efforts to reduce interest rates. Banks and financial institutions will be under immense pressure as the fear of NPAs, insolvency and bankruptcies will increase manifold.

10. Impact on trade

The United Nations Conference On Trade And Development (UNCTAD) has estimated that India’s trade impact due to the COVID-19 outbreak could be around USD 348 million.

The sad state of affairs is the effect of all the circumstantial conditions on the rupee value, exerting extra burden on the cost of imports of commodities and services in India and on the accumulated foreign reserves.

Repercussions On Employment

International Labour Organisation has estimated about 40 crore workers of the unorganised sector to go unemployed due to the pandemic.

As estimated by the Center For Monitoring Rate, the overall unemployment rate may have surged to 23%, with urban unemployment at nearly 31%.

Most of the rural population, particularly the daily wage earners, have been adversely affected as they are mostly employed in the informal sector, majorly in construction companies. Due to the shutdown, they have been rendered jobless and thus are being forced to migrate to their native place.

Many people have lost their jobs as the country is facing a period of slowdown and recession.

What Relief Measures Have Been Taken By The Government?

The Central Government has announced much-needed relief measures in areas of Income tax, GST, customs and central excise, corporate affairs, insolvency and bankruptcy, fisheries, banking sector and commerce with the intention of boosting the economy.

Atmanirbhar Bharat Abhiyan

Recently, the Prime Minister of India announced India’s self-reliant mission with economic packages worth Rs 20 lakh crores. The mission aims to make India self-reliant and cut down import dependencies, with a focus on supply chain reforms, rational tax system, simple and clear laws, capable human resources and a strong financial system.

Relief Measures Taken By The Reserve Bank Of India

The RBI reduced the reverse repo rate in April 2020 by 25 basis points to 3.75%. It also announced a refinancing window of Rs 50,000 crores for financial institutions NABARD and SIDBI.

The Road Ahead

Though the recovery of the underlying economy will be slow and will take around two years for normalcy to come back across sectors, this is the right time to start from scratch and prove our mettle. This pandemic has taught us a lesson of becoming self-reliant in every aspect and, for that to happen, not only the government and financial institutions need to take initiatives, but we the citizens of India should also take the responsibility to uplift the deteriorating economy.

In my opinion, we all should contribute to infrastructural development and rigorously work on the slogan of “Rebuild India Rejuvenate India”.

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An ambassador and trained facilitator under Eco Femme (a social enterprise working towards menstrual health in south India), Sanjina is also an active member of the MHM Collective- India and Menstrual Health Alliance- India. She has conducted Menstrual Health sessions in multiple government schools adopted by Rotary District 3240 as part of their WinS project in rural Bengal. She has also delivered training of trainers on SRHR, gender, sexuality and Menstruation for Tomorrow’s Foundation, Vikramshila Education Resource Society, Nirdhan trust and Micro Finance, Tollygunj Women In Need, Paint It Red in Kolkata.

Now as an MH Fellow with YKA, she’s expanding her impressive scope of work further by launching a campaign to facilitate the process of ensuring better menstrual health and SRH services for women residing in correctional homes in West Bengal. The campaign will entail an independent study to take stalk of the present conditions of MHM in correctional homes across the state and use its findings to build public support and political will to take the necessary action.

Saurabh has been associated with YKA as a user and has consistently been writing on the issue MHM and its intersectionality with other issues in the society. Now as an MHM Fellow with YKA, he’s launched the Right to Period campaign, which aims to ensure proper execution of MHM guidelines in Delhi’s schools.

The long-term aim of the campaign is to develop an open culture where menstruation is not treated as a taboo. The campaign also seeks to hold the schools accountable for their responsibilities as an important component in the implementation of MHM policies by making adequate sanitation infrastructure and knowledge of MHM available in school premises.

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Harshita is a psychologist and works to support people with mental health issues, particularly adolescents who are survivors of violence. Associated with the Azadi Foundation in UP, Harshita became an MHM Fellow with YKA, with the aim of promoting better menstrual health.

Her campaign #MeriMarzi aims to promote menstrual health and wellness, hygiene and facilities for female sex workers in UP. She says, “Knowledge about natural body processes is a very basic human right. And for individuals whose occupation is providing sexual services, it becomes even more important.”

Meri Marzi aims to ensure sensitised, non-discriminatory health workers for the needs of female sex workers in the Suraksha Clinics under the UPSACS (Uttar Pradesh State AIDS Control Society) program by creating more dialogues and garnering public support for the cause of sex workers’ menstrual rights. The campaign will also ensure interventions with sex workers to clear misconceptions around overall hygiene management to ensure that results flow both ways.

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MH Fellow Sabna comes with significant experience working with a range of development issues. A co-founder of Project Sakhi Saheli, which aims to combat period poverty and break menstrual taboos, Sabna has, in the past, worked on the issue of menstruation in urban slums of Delhi with women and adolescent girls. She and her team also released MenstraBook, with menstrastories and organised Menstra Tlk in the Delhi School of Social Work to create more conversations on menstruation.

With YKA MHM Fellow Vineet, Sabna launched Menstratalk, a campaign that aims to put an end to period poverty and smash menstrual taboos in society. As a start, the campaign aims to begin conversations on menstrual health with five hundred adolescents and youth in Delhi through offline platforms, and through this community mobilise support to create Period Friendly Institutions out of educational institutes in the city.

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A student from Delhi School of Social work, Vineet is a part of Project Sakhi Saheli, an initiative by the students of Delhi school of Social Work to create awareness on Menstrual Health and combat Period Poverty. Along with MHM Action Fellow Sabna, Vineet launched Menstratalk, a campaign that aims to put an end to period poverty and smash menstrual taboos in society.

As a start, the campaign aims to begin conversations on menstrual health with five hundred adolescents and youth in Delhi through offline platforms, and through this community mobilise support to create Period Friendly Institutions out of educational institutes in the city.

Find out more about the campaign here.

A native of Bhagalpur district – Bihar, Shalini Jha believes in equal rights for all genders and wants to work for a gender-equal and just society. In the past she’s had a year-long association as a community leader with Haiyya: Organise for Action’s Health Over Stigma campaign. She’s pursuing a Master’s in Literature with Ambedkar University, Delhi and as an MHM Fellow with YKA, recently launched ‘Project अल्हड़ (Alharh)’.

She says, “Bihar is ranked the lowest in India’s SDG Index 2019 for India. Hygienic and comfortable menstruation is a basic human right and sustainable development cannot be ensured if menstruators are deprived of their basic rights.” Project अल्हड़ (Alharh) aims to create a robust sensitised community in Bhagalpur to collectively spread awareness, break the taboo, debunk myths and initiate fearless conversations around menstruation. The campaign aims to reach at least 6000 adolescent girls from government and private schools in Baghalpur district in 2020.

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A psychologist and co-founder of a mental health NGO called Customize Cognition, Ritika forayed into the space of menstrual health and hygiene, sexual and reproductive healthcare and rights and gender equality as an MHM Fellow with YKA. She says, “The experience of working on MHM/SRHR and gender equality has been an enriching and eye-opening experience. I have learned what’s beneath the surface of the issue, be it awareness, lack of resources or disregard for trans men, who also menstruate.”

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A Computer Science engineer by education, Nitisha started her career in the corporate sector, before realising she wanted to work in the development and social justice space. Since then, she has worked with Teach For India and Care India and is from the founding batch of Indian School of Development Management (ISDM), a one of its kind organisation creating leaders for the development sector through its experiential learning post graduate program.

As a Youth Ki Awaaz Menstrual Health Fellow, Nitisha has started Let’s Talk Period, a campaign to mobilise young people to switch to sustainable period products. She says, “80 lakh women in Delhi use non-biodegradable sanitary products, generate 3000 tonnes of menstrual waste, that takes 500-800 years to decompose; which in turn contributes to the health issues of all menstruators, increased burden of waste management on the city and harmful living environment for all citizens.

Let’s Talk Period aims to change this by

Find out more about her campaign here.

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A former Assistant Secretary with the Ministry of Women and Child Development in West Bengal for three months, Lakshmi Bhavya has been championing the cause of menstrual hygiene in her district. By associating herself with the Lalana Campaign, a holistic menstrual hygiene awareness campaign which is conducted by the Anahat NGO, Lakshmi has been slowly breaking taboos when it comes to periods and menstrual hygiene.

A Gender Rights Activist working with the tribal and marginalized communities in india, Srilekha is a PhD scholar working on understanding body and sexuality among tribal girls, to fill the gaps in research around indigenous women and their stories. Srilekha has worked extensively at the grassroots level with community based organisations, through several advocacy initiatives around Gender, Mental Health, Menstrual Hygiene and Sexual and Reproductive Health Rights (SRHR) for the indigenous in Jharkhand, over the last 6 years.

Srilekha has also contributed to sustainable livelihood projects and legal aid programs for survivors of sex trafficking. She has been conducting research based programs on maternal health, mental health, gender based violence, sex and sexuality. Her interest lies in conducting workshops for young people on life skills, feminism, gender and sexuality, trauma, resilience and interpersonal relationships.

A Guwahati-based college student pursuing her Masters in Tata Institute of Social Sciences, Bidisha started the #BleedwithDignity campaign on the technology platform Change.org, demanding that the Government of Assam install
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