Essay On Impact Of Covid-19 On Indian Economy
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Introduction (Essay On Impact Of Covid-19 On Indian Economy)
India’s economy is a consumption-based economy. Due to the nationwide lockdown imposed during the Corona epidemic, there has been a shortage in both supply and demand.
Due to this, traders have had to stop their work. At the same time, consumers have been forced to stay in their homes. Due to this drastic lockdown, economic activities almost stopped and the Indian economy shrank by about 23% during this Corona period.
Due to this, many major sectors of the country have seen a decline, which has a direct impact on the country’s productivity, business, employment opportunities, investment, and services.
Experts believe that during Covid-19, there will be a loss of productive activities of more than Rs 15 lakh crore in the Indian economy. In this, employment of people associated with sectors like schools, transport, tourism, entertainment, hotels, restaurants, and construction has been affected the most.
In addition, 40% of the GDP belongs to the informal sector, with no real data available on an annual basis. Therefore, it is estimated that lakhs of workers associated with the informal sector have returned to their homes and villages, leaving productive activities during the lockdown.
Similarly, such Industries or businesses which had taken loans from banks will also not be able to repay the loans in time. Which can increase the NPA of banks.
Overall, the cyclical flow of business of the economy has deteriorated badly during this period. Which will affect the lives of almost all regions and people.
In such a situation, Experts believe that the government will have to adopt comprehensive measures to improve the economy, And an efficient strategy will be needed to bring it back to a profitable position.
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Efforts by the government
Apart from this, the Finance Ministry says that the rising consumption expenditure of the central government in the domestic sector has increased domestic demand for GDP growth and also improved GST collections on a year-over-year basis.
The Finance Ministry has said that the contraction in the Indian economy is the result of the most stringent lock-down imposed by India. And India is expecting a V-shaped recovery in the coming time.
The Finance Ministry has said in the latest Economic Review Report that the agricultural sector has accelerated the development of economic activities in the country.
Economic experts views
According to the experts, about 26% of India’s domestic demand was completely lost in the corona period, ie it would have a direct impact on the purchasing power of the people.
And it will be a big challenge for the government to maintain the balance between demand and supply at this time.
Apart from this, the biggest impact of GDP contraction has been seen in big states like Tamil Nadu, Uttar Pradesh, Gujarat, Karnataka, and Maharashtra.
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Conclusion (Essay On Impact Of Covid-19 On Indian Economy)
Contraction is bad for any economy because it badly affects the cycle of demand and supply. In addition, the central government should work closely with the state governments to increase economic activity.
For this, the central government, along with the state governments, may consider a change in the rate of GST to increase revenue collection and give some concessions to taxpayers.
The government should create employment opportunities in rural areas and implement the schemes like MGNREGA for the workers coming back to the cities in search of work and provide them work opportunities.
Overall, the economic contraction of this corona period is challenging for the whole world, in such a situation, we all have to work together so that we can get out of the economic depth and move towards positive growth again.
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