Covid-19 is not only a global pandemic, but it has affected the economy drastically. It had a significant effect on the financial sector. There has been a significant reduction in income, and there has been a huge job loss due to this pandemic.
The manufacturing industries and the transportation of goods and services had been severely affected due to the pandemic. These are because of the measures taken by various countries of the world to mitigate the disease.
It was evident that most of the countries, including the developed countries, had underestimated the drastic effect of covid-19. Instead, they mostly reacted only to the crisis. Till now, it has been very clear that the outbreak of the disease is not going to disappear, at least not so soon. So proactive actions are a need of the hour to deal with the drastic effect of Covid-19 on the economy.
Covid-19 And The Indian Economy
The Times of India had mentioned that as per the official data of the ministry of statistics and the implementation of the program, the economy of India has contracted by about 7.3 percent within the second quarter of the present financial year. It is said to be the worst decline ever since the ministry started compiling the GDP statistics every quarter in the year 1996.
It has been estimated that about 10 million migrant workers had returned to their native in 2020 as their workplaces were closed due to the lockdown in the country. But it was shocking to see that neither the central government nor the state government had any data regarding the number of migrant workers who lost their jobs and returned to their homes being unemployed.
The government had extended a certain amount of help to the migrant workers who lost their jobs and had to return to their native during the 2nd wave of covid-19 in India. The second wave of the covid-19 had a very drastic effect on the Indian economy and had worsened the existing vulnerabilities in the economy.
The $2.9 trillion economies had been shuttered during the period of the lockdown. Except for the transfer of some essential commodities and activities, all other things were closed for several months for the lockdown.
Impact of Covid-19 In The Various Sectors of The Economy
Covid-19 had a worse effect on the various sectors of the economy. Following are some of the industries that have been affected by the Covid-19 pandemic:
- Hospitality Sector– Different states have again imposed partial or complete lockdown during the second phase of the covid-19 pandemic. Due to this, the hospitality sector is facing repeat consequences the same as it had to face in 2020.
The hospitality sector comprises various businesses such as restaurants, hotels, pubs, bars, etc. this sector has a significant contribution to the annual GDP of India, and it had been hit badly due to the curfews and the lockdowns that were put in place.
- Tourism Sector- The hospitality sector has direct links with the tourism sector of the country. Emerald.com had mentioned that the Tourism sector employs about a million Indians who were drastically affected by the hitting of the first wave of Covid-19 in India. After the end of the first wave, when they started to bounce back gradually, the country was again hit by the second wave.
It was more potent than that of the first wave and had claimed many lives. According to a report, the tourism sector contributes about 7% to the annual GDP of India. The tourism sector, which was struggling to recover after the first wave, had been crippled by the second wave.
- Travel And Aviation Sector– The travel and the aviation sector struggled a lot during the second wave of the pandemic. It is because people in India are terrified to step out of their homes and travel. The recovery of this sector would only depend on the time the people think of stepping out and traveling. At present, the situation of this sector doesn’t look so good.
- Real Estate Sector- As many migrant workers had left for the urban sector, the real estate and the construction sector had started facing disruptions during the second wave of the pandemic. But the situation has not been so grave as in the year 2020 for the real estate sector, as mentioned by housing.com
Conclusion
The spread of the covid-19 virus would likely continue disrupting the various industries and commerce across the country. The financial markets would continue to remain volatile. However, it is still unsure if the pandemic would have a long-term effect on the global economy or the short-term outcome. So there must be international collaboration in the worldwide vaccination program, which is the only way to get some relief from the pandemic.