How has the lockdown affected the economy of Maharashtra. Express your views and opinions.
justify your answer with statistical data which shows the impact of the lockdown on the three sectors
•Primary sector
•Secondary sector
•Tertiary sector
Answers
Answer:
The covid-19 epidemic is the first and foremost human disaster in 2020. More than 200 countries and territories have confirmed effective medical cases, caused by coronavirus declared a pandemic by the WHO. Recent growth rate case globally has accelerated to more than 12,00,000 covid-19 confirmed cases and more than 66,000 deaths till April 1, 2020.
As we have already acknowledged that India is a developing economy, it is stated as an economy passing through demand depression and high unemployment, with 21-day lockdown announced by Prime Minister Narendra Modi on March 23, 2020, it would slowdown the supply-side, accelerating the slowdown further and jeopardising the economic wellbeing of millions.
With an increasing number of coronavirus cases, the government has locked down transport services, closed all public and private offices, factories and restricted mobilization. Based on recent studies, some economists have said that there is a job loss of 40 million people (MRD report) in the country, mostly in the unorganized sectors.
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Explanation:
India is one of the most affected countries from the coronavirus pandemic, with more than 400,000 reported cases since January.
To slow down the spread of the virus, India's government implemented a national lockdown in late-March, which continued until May.
While the lockdown took a toll on the economy, the number of infection cases continues to climb with growth prospects for the current quarter collapsing.
GP: India coronavirus lockdown 200515
A volunteer in Chennai, India holds a placard to raise awareness about the coronavirus on a street during a government-imposed nationwide lockdown to combat the spread of Covid-19.
Arun Sankar | AFP | Getty Images
India is one of the world's worst hit countries in the coronavirus pandemic, with reported cases spiking in recent weeks as the country emerged from a strict nationwide lockdown.
Cumulatively, India has reported more than 400,000 cases of infections since January. Though, relative to its population size, the percentage of infected individuals is still low. India also says the number of people who have recovered is higher than those currently affected by the virus.
The country's lockdown began in late March and was subsequently extended several times. Stringent restrictions halted most economic activities and caused millions of people, many of them daily wage earners, to lose their jobs and revenue streams.
Investment bank Goldman Sachs last month predicted a massive 45% economic decline in the three months between April to June. Ratings agency Moody's slashed India's credit ratings to the lowest investment grade level.
India's recovery trajectory is going to be weak as the country is struggling to get past the peak of the pandemic, according to Priyanka Kishore, head of India and Southeast Asia economics at Oxford Economics. She also said India's fiscal policy response has been "quite meagre" compared to the stringency of the lockdown.
To mitigate the economic fallout, Prime Minister Narendra Modi's government had announced a $266 billion support package containing both fiscal and monetary measures, said to be worth around 10% of India's GDP.
But economists have said the package will do little to stimulate growth, as it includes very little planned government spending and benefits of several measures are expected to only be seen in the medium term.
While the impact on India's gross domestic product for the current quarter will not be known for a few more months, these charts below paint a snapshot of how economic activities were hampered during the lockdown.
Industrial production
20200622 Asia Roy India Industrial Production
India's industrial production dropped sharply in April when the country went into lockdown and most factories were not in operation. The index contracted by 55.5% compared with the same period a year earlier. That includes sectors such as mining, manufacturing and electricity. Manufacturing of consumer durables saw the sharpest decline for the month.
The government said that the majority of industrial establishments reported no production for April.
"Consequently, it is not appropriate to compare the IIP of April, 2020 with earlier months," the Ministry of Statistics and Programme Implementation said in its data release earlier this month, adding that the information will "undergo revision" in the coming months.
Data for May will be released in July.
Business activity and new orders
20200622 Asia Roy India PMI data
The services industry collapsed in April as most businesses were shut due to the lockdown. A private survey by IHS Markit showed "extreme decline" in activity. The services business activity index compiled by the firm came in at a shocking 5.4, far below an industry forecast of around 40. Readings above 50 indicate expansion while those below that level represent contraction.
Business activity in the services sector also fell drastically in May as the pandemic hindered operations, reduced footfall in shops and led to a decline in demand. The number last month was 12.6 and IHS Markit said in its report that survey data "still pointed to extreme month-to-month declines in output and new orders." Domestic travel and tourism sectors also declined sharply, contributing to the fall in services business activity.
IHS Markit pointed to India's auto sector in a separate note this month. Production was largely shut in April before lockdown conditions started to be gradually eased. Citing the Society of Indian Automobile Manufacturers, the note pointed out the daily turnover lost for the auto manufacturing sector for each day of closure was around $300 million per day.