WREAKING COVID 19 PANDEMIC-SECTORAL AND SPATIAL DIMENSIONS IN INDIA

 

                           UNDERSTANDING THE HIDDEN COSTS OF

                                  AN UNPRECEDENTED PANDEMIC

''The pandemic represents a rare but narrow window of oppurtunity to reflect , reimagine and reset our world ''

- Klaus Schwab

( Founder and executive chairman of World economic forum )

The 'wreaking Covid -19 pandemic 'from the very first confirmed case' to a 'bunch of variants' is staggering the global socio-economic-political scenario . India with a population near to 1.4 Billion, deficient on public health expenditure and ill-prepared to face a massive humanitarian crisis as well as economic downturn incurred a profound impact during this phase . It's magnitude is reflected in the largest ever GDP contraction in Q2 of FY 2020-21 at 24% . Still India expected a 'V' shaped recovery as picturized below .

But what India currently witness is a 'K shaped economic recovery plotting the uneven impact among different sectors .

This is where examining THE SECTORAL AND SPATIAL DIMENSIONS OF COVID 19 seems relevant .

PRIMARY SECTOR AND RURAL ECONOMY

Agriculture was the sole bright spot amid dismal GDP perfomance of other sectors ,clocking a growth rate of 3.4% at constant prices in the first quarter of 2020-21 . According to the agriculture and allied industries report , Agriculture is the primary source of livelihood for about 58% Indian population and hence significant . The area sown was larger compared to the corresponding period of last year and Crop production has been least impacted with a decline of 2.7% . The production was not that hit mainly because the harvesting was over even before the widespread of the pandemic . But the production in allied sector had declined significantly especially in poultry sector (-19.5%), followed by fisheries sector (-13.6%), Sheep/Goat/Pig (-8.5%), dairy (-6.6%) and horticulture (-5.7%) etc which in turn left many families struggling to make ends meet .This is mainly because of the The circulated fear that the animal products may cause infection which reduced the demand drastically .

The trend of agricultural commodity prices are not uniform across the country . The lackof transport , shut down of markets , reduced purchasing power of consumers etc and the subsequent reduction in demand led to a price cut in many places . Whereas the supply chain disruptions caused price rise also for many products according to a NABARD study . The travel restrictions and large scale transition to online shopping and door-to-door services impacted local markets and shops . The agricultural input price was also in rise due to disturbed cash flow ,exports,increased labour costs due to reverse migration etc .

This sector has an another perspective too .

While atleast 70 trucks of vegetables each weighing 15 tonnes were rotting at the markets,India performed badly in 'food security' where about 200 million became undernourished . As perr the Global hunger Index 2021 with a score of 27.5 ,India has a 'serious' level of hunger . The high unemployment rate deepened the disguised unemployment and fragmented lands also threatening the agrarian economy .

SECONDARY SECTOR AND SUB-SECTORS

The paralysis of Industrial sector weakened the Indian economy to a great extent . Because this sector being labour intensive in Indian context provide huge job oppurtunities and create demand for the industry of raw materials as well . But the sudden halt resulted in 'Unemployment rates'(urban) high at 20.9% during April-June quarter and unprecedented reverse migration . But we cannot generalise this trend .

SECTORS PROSPERING IN THE PANDEMIC

* E-commerce (eg;Amazon)

*Technology (eg;Microsoft,Apple,Zoom)

* Cloud software

* Payments (Paypal)

*Telecommunications (eg'T-mobile)

* Media(Netflix)

*Pharmaceutical companies(Dr.Reddy lab.,Sun Pharma)

*Vaccine makers(SII)

*Digital services

and many more ..

ASSESSING THE IMPACT ON -

* HEALTHCARE INDUSTRY

The healthcare industry can be analysed by segregating into past,present and future phases . The underdeveloped healthcare delivery infrastructure , 1:1456 doctor – population ratio (as of 2020) against WHO recommendation etc clearly hints the ill-prepared past . This itself aggravated the covid scenario with lack of oxygen,beds and thousands of lives . Some of the major concers were the overwhelmed healthcare industry , inequitable access ,Poor working conditions of frontline healthcare workers and hit on non-covid diseases . The deferred treatment of other chronic diseases,struggle in clinical trials etc is an implied effect . There was 80% reduction in new patient recruitment during April 2020.Once thriving 'medical tourism industry' also had a hard blow due to pandemic restrictions .

But there is a huge scope here to transform uncertainity to oppurtunities and science

*Increased Investments on primary healthcare and intensive care facilities

*Government policies for universal healthcare access . (Ayushman Bharat-health card)

*Paradigm shift to Tele health ,remote care , digital healthcare solutions,end to end healthcare services

*Affluence of biotech and pharma industries

* Growth of 7.28% in biotechnology sector is expected world wide for 2020-24

etc...

*AUTOMOTIVE INDUSTRY -

The graph below will give a global picture of how the closure of plants,disruption in exports,raw materials etc affected the sector.

But there is a ray of hope in the recovery of this sector which play a central role to make India a $5 trillion economy .

*POWER AND ENERGY SECTOR

Covid-19 caused power demand to fall by 28% up to the end of March 2020, according to the system operator POSOCO (IEA Global Energy Review 2020 . Now the country is looking forward for a resilient power sector . But the report on renewable energy is hopeful.

*PUBLIC TRANSPORTATION , TRAVEL AND TOURISM

India is one of the developing nations known for its uniqueness in its tradition, culture and unparalleled hospitality. It is a major destination for many international tourists, creating several employment opportunities and generating enormous taxes .But the pandemic shook the tourism industry where  India's Covid-19 lockdown should have caused 38 million job losses in the travel and tourism industry . Aggravating the situation there was a fall in foreign tourists’ arrival rate by 68% from February to March 2020 and hence fall in foreign exchange earnings (FEE) by 66.32%, which has a significant impact on the economy (Statista, 2020). 

*STOCK MARKET

WEIGHTED AVERAGE SHAREHOLDER RETURNS

DECLINE ACROSS SECTORS ANTICIPATED RECOVERY

MARCH 2020 FEBRUARY 2021

As  stock index reflects overall market sentiment and direction of price movements of products in the financial, commodities or any other markets , its” analysis gives us a vivid picture . This Stock market performance reveals the impact of accelerating trends, growing gaps between the winners and the rest, and a flow of value to megaplayers. Thus it indicates the amplification of corporate perfomance gap even within the sectors and between the sectors .

*MICRO SMALL MEDIUM ENTERPRISES -

Micro,Small and Medium Enterprises (MSMEs) are considered to be the backbone of the Indian economy .It is the second largest employment generating sector (after agriculture), employing nearly 120 million people in India .The price of key raw materials , disturbed cash flow,ppp,exports,supply chain and thus impacted production level worsened the ineffectual msme sector . But thinking from an another perspective the budgets presented during covid and Atmanirbhar Bharat have given due focus on the revival of this sector . The Budget estimates for the sector for 2020-2021 was ₹7,572 crore. But Union Budget presented on february 2021 doubled the allocation to micro, small and medium enterprises (MSMEs) to ₹15,700 crore for the next financial year.

*FOOD INDUSTRY

The NRAI report stating the 53% shrinking in Indian restaurant industry reveals the negative effect . This contraction in the food service industry led to closure of more than 25% food business operators thus resulting in a job loss of 2.4 million . But online food delivery companies got a hike these days while all the people preferred door-to-door services .

SERVICE SECTOR

EDUCATION : Education sector witnessed an unequal survival in different

region among different communities . Covid pandemic opened a new market of online learning for traditional education system of India . But the stark didital divide made this approach limited . But the government ptojects were able to provide many needy ones basic digital assistance .

The ASER report 2021 addressed an unpredicted increase in government school enrollment rather than private schools . It implies the unaffordable expenses due to economic downturn as well as better responsible permofance of government institutions .

BANKING & INSURANCE : These sectors ensure financial stability and social security of the people . Access to credit flow regulated by banks like MUDRA bank,Co-operative banks ,NBFCs etc supported the common man so much . But the leaps and bounds of bad loans and non – performing assets(npa) became a huge burden on the banks . Finally banking sector witnessed many reforms including a new

'asset reconstruction company' .

THE IMPACT ON INDIAN CULTURE

Indian culture is unique from the rest of the world reinforcing unity in diversity . The handicraft industry , handloom . Khadi , cottage industries etc nourishes the culture. On one hand Covid 19 have impacted the exports thereby affecting the international market demand .But on the other hand ,Self – reliant India plans and vocal for local proposed during this phase will reboost such industries . Another reality is the life of Artists(on-stage;off-stage)

whose job oppurtunities came into a stake all of a sudden . In the recovery phase also,their trend is comparatively slow .

INDIAN SOCIETY AND COVID 19

The Indian society with a demographic dividend was confident enough on its youth . But the suicidal tendencies got concealed in the population amidst the growing concerns over the impact of pandemic in their lives . The longterm impact on the behavioural health like PTSD,anxiety,depression,insomnia also can be seen .

Another trend is the skyrocketing number of crimes against women, elderly people,minors etc . Though work from home gave women a better work -life balance,immense number of drop outs , early marriages etc still go on . Though women population was less exposed to covid they were highly vulnerabale to the sexual abuses where own home itself became unsafe for many . The number of cases reported at childcare is a true example . Along with this Indian society started experiencing privacy attacks and cybercrimes .

The latest world inequality report 2022 which categorizes India as a 'poor and very unequal country,with an affluent elite' reflects the reality of Indian society . 10% holds 57% of total national income while bottom 50 % share only 13%. The covid 19 pandemic is a major reason behind this widening income inequality . Thus different studies ascertain the direct relation between the pandemic and hunger,povery,under nourishment etc .

Thus sectoral and spatial dimensions of covid 19 ranging from primary sector and rural eocnomy , secondary sector and sub sectors ,service sectors to society,culture etc gives us an insight on the multifaceted implication of the pandemic . This Pandemic being a battle of lives and livelihoods taught us to better go with inclusive scientific resource allocation rather than focusing on vote bank politics .

This is when the term 'Resilience 'come into picture . Resilient implies that strong enough to deal with illness, a shock, change, etc. The pandemic prone global economic environment transformed India's economic outlook by stressing on its resilience .

''For an economic recovery program to be effective , it must not only create a short term economic boost but also generate lasting value ''.

- Peter Welch

Let's grasp lessons from Covid 19 ..

make necessary amendments to the system

and build a better nation to build back world better .

SANDRA SARA BINOY

2ND YEAR]

BA ECONOMICS

GOVT.VICTORIA COLLEGE PALAKKAD

6238459854