The impact of the covid-19 pandemic on India had been primarily disruptive in terms of economic activity and human life loss. Almost all industries had suffered as domestic demand and exports have collapsed, with a few notable exceptions where substantial growth was witnessed.
The pandemic has taken a heavy toll on India, notably during the second wave of the virus in the spring of 2021. The dramatic decline in GDP was the country’s greatest in history, yet it may still underestimate the economic harm suffered by the poorest households. Therefore I (Apratim) tried to make an attempt to assess the effect and potential remedies for a few significant industries.
IMPACT ON AGRICULTURE
Since agriculture is the country’s backbone and a part of a government-announced important category, the impact on both primary agricultural production and agro-input consumption was anticipated to be minimal. Most states have seen a decrease in production in the agricultural sector. Agriculture production had fallen sharply in states such as Chhattisgarh (13%) and Himachal Pradesh (15%). However, some large agricultural states like Telangana (23 % increase), Punjab (5%), Rajasthan (4.4%), and Gujarat (6.7%) had actually shown an increase in agricultural production which was attributed to the fact that the rabi season had witnessed a bumper crop production.
Due to unclear mobility limitations and the halting of logistics trucks, online food grocery platforms were severely hampered. Rabi crops were the least affected because harvesting was nearing completion, but related industries like poultry, fisheries, and the pig/goat/sheep sector saw a severe drop in demand owing to mistaken rumors, resulting in decreased production as well as declining farm gate prices. However, agricultural input costs were expected to rise, owing to disruptions in the supply chain and the closure of stores and marketplaces.
IMPACT ON ECONOMY
India’s GDP fell by a whopping 24.4 percent between April and June 2020. According to the most recent national income projections, the economy declined by 7.4 percent in the second quarter of the 2020/21 financial year (July to September 2020). The recovery remained sluggish in the third and fourth quarters (October 2020 to March 2021), with GDP expanding by 0.5 percent and 1.6 percent, respectively. This indicates that India’s total rate of contraction was (in real terms) 7.3 percent for the whole 2020/21 financial year.
Before 2020, India’s national GDP fell just four times in the post-independence period — in 1958, 1966, 1973, and 1980 – with the greatest loss being in 1980. (5.2 percent ). This suggests that 2020/21 was the worst year in terms of economic contraction in the country’s history, far worse than the global recession.
IMPACT ON TOURISM AND AVIATION
The Aviation Sector and Tourism both contribute roughly 2.4 percent and 9.2 percent of our GDP, respectively. In the financial year 2018-19, the tourism industry serviced around 43 million people. The first businesses severely impacted by the pandemic were aviation and tourism. It had a greater impact on these industries than 9/11 and the 2008 financial crisis. Since the beginning of the pandemic, these two industries were experiencing serious cash flow problems and were facing a probable layoff of 38 million people, or 70% of the entire workforce.
Both white-collar and blue-collar occupations were affected. According to IATO estimates, travel restrictions cost these businesses almost 85 billion rupees. In the domains of contactless boarding and transport technology, the Pandemic sparked a rush of innovation.
IMPACT ON EDUCATION
The impact of Covid-19 was felt all over, resulting in the closure of schools and other educational institutions. To mitigate the impact of Covid-19, most governments first agreed to temporarily close schools. Later it was reopened for a few grades, which increased the number of infection rates and then closed again.
Despite the fact that schools were closed, students were still attending lessons via other educational initiatives such as online classrooms and radio programs. On the other hand, while this was a wonderful thing, many students who do not have the financial means to attend online classes suffered greatly. Many students faced difficulty in obtaining the necessary equipment for online classes.
Teachers that are professionals in Blackboard, Chalk, Books, and classroom teaching are new to digital teaching, but they quickly adapt and managed it like a pro to help students in their current situation. But on the negative side, many teachers looked for an alternative job to support their families. This pandemic has harmed not just students, but also low-budget institutions and schools, forcing many to shut.
BEYOND COVID: THE NEW NORMAL
Given the magnitude of the pandemic’s disruption, it is clear that the present slump is fundamentally different from previous recessions. The business environment will be altered by the unexpected drop in demand and greater unemployment. Businesses will be able to take a new road in this unpredictable climate by adopting new ideas such as “move toward localization, cash conservation, supply chain resilience, and innovation.”