We are living in unprecedented times and definitely, as a global health challenge, coronavirus is strengthening its grip. Therefore, do we hope for the best or prepare for the worst. Actually, both. But, paralyzing phobia can never be helpful. As a nation, we are giving a befitting health system response. Everybody is worried about the impact of the virus on the globe in different forms. Already more than 2 lakh people are suffering worldwide and more than 10000 have lost their lives. It is expected that the cases will spread even more in the coming few days. The health impact is very much visible in the form of number of infected persons but the extent of its overall economic effects are still not very clear.
It is expected that Novel Coronavirus (COVID-19) will largely have negative impact on world economy. The stock markets in all the affected countries are falling and industries are not getting raw material. Many companies are cutting down production. Because of lockdown, the demand is also less. Therefore, the growth of the economy of many countries in the world will contract. UNCTAD has warned a slowdown of global growth to under 2 percent, which is equal to one trillion of the world economy (WEF). According to a poll, there will be fall in the GDP growth of China from three to four percent. The similar negative impacts of fall in economic activities are estimated in the countries like Italy, Iran and other countries where coronavirus has become a pandemic.
Although, when we look at our stock markets, it is generally fear we can smell. This article, aims at providing some breather for the people preparing for the worse, it gives some hope.
Data Source: https://www.worldometers.info/coronavirus/#countries
Being the second highest populated country in the world, India has largely avoided the scare as total number of cases per million populations, is least. Almost all the countries are suffering with slowdown in economic activities. In India, because of less impact of coronavirus and high marginal propensity to consume, there are very less chances of persistent drop in economic activities. The present downturn in the market is only based on negative sentiments due to coronavirus and global slump. The markets in India should bounce back sharply while in some other countries it may take longer period and the recovery phase may be much elongated.
Among all these ups and down in the world economy, there are some opportunities for India on the economic front. It is expected that due to outbreak of Coronavirus in China, many foreign investors may shift investments in India to diversify their operations. There are chances that India will get more FDI in the near future. That will give a robust growth to make in India campaign. Indian present government also has strong political will for the same. Huge population base, rural demand and availability of skilled and cheap labor and inflow of huge FDI will give impetus to the economy. It is a chance for India to increase export of essential drugs and other materials as a substitute of China.
Among all these prospects, it is important to take some strict steps to prevent the outbreak of coronavirus on a large scale.
Stay healthy. Stay Safe. Be optimistic, it’s not the end. Perhaps, a new beginning.
Author: Dr. Sumesh Kumar
Assistant Professor (Economics), International Institute of Health Management Research, New Delhi
https://iihmrdelhi.edu.in/team-iihmr/assistant-professors
Author: Dr. Pankaj Talreja
Assistant Professor (Healthcare Finance), International Institute of Health Management Research, New Delhi
https://iihmrdelhi.edu.in/team-iihmr/assistant-professors
Your article helped me a lot, is there any more related content? Thanks! https://www.binance.com/cs/join?ref=P9L9FQKY
Can you be more specific about the content of your article? After reading it, I still have some doubts. Hope you can help me. https://accounts.binance.com/cs/register-person?ref=FIHEGIZ8