The outbreak of the COVID19 pandemic, also known as a “black swan event”, had a negative impact on not only people’s health but also the socio-economic activities of countries all over the world.
To flatten the pandemic curve, the governments of nearly 162 countries have announced strict border closures, travel restrictions, and lockdown measures.
As a result, it had severely disrupted major areas such as global supply chains, trade, agriculture industry, automotive industry, electronic industry, travel, transportation, and tourism industry, and so on.
Due to the lockdown, the economy of various other sectors such as aviation, entertainment, sports, and so on has been severely hampered all over the world.
Covid-19: Impact on Agriculture Sector
- It has been demonstrated that pandemic and quarantine have not only affected human activities and economic growth but have also affected agricultural activities in the past.
- When contagious disease spreads, there is an increase in malnutrition and starvation.
- As the infection spreads, the condition worsens, causing group limitations to become increasingly severe, resulting in labour shortages for the harvest or complexities for farmers in transporting goods to market.
- To survive their lives, nearly 60% of humans impart on agriculture and hence it remains central to the entire world economy.
- COVID19 had a significant impact on some agricultural subsectors such as crop farming, livestock, agro-forestry, fishing, and aquaculture.
- Because of transportation restrictions and decreased purchasing capacity, Covid-19 infection has greatly impacted food demand and, as a result, food security.
- The impact of disruptions in the demand for food supply chain, such as consumer panic purchasing of essential items and changes in consumption styles due to the closure of the food retailing sector. Due to a scarcity of seed, aquaculture production became complicated.
- The pandemic had the greatest impact on dairy product delivery. Farmers are experiencing a shortage of agricultural inputs such as seed, pesticides, and fertilisers because of the overall trade disruption.
- According to a study, 820 million citizens are currently facing severe hunger, while 113 million face acute uncertainty.
- More than ten million children rely on school-provided meals to meet their nutritional needs.However, due to the closure of schools and school meal programmes, children were not receiving their meals, which reduced their ability to cope with the pandemic.
Covid-19: Impact on Manufacturing Sector
- According to a survey conducted by the United Nations Industrial Development Organisation (UNIDO), manufacturing in India ceased after the lockdown was imposed , except for the rice milling sector, where production reportedly dropped by half.
- Metals and chemical products, motor vehicles, machinery and equipment, textiles, and other manufacturing industries have been particularly hard hit.
- The automobile industry, which was dealing with the new Bharat Stage (BS) VI regulations, faced a shortage of spare parts from China, where factories had been closed due to the coronavirus outbreak.
- According to a parliamentary panel report, the Indian automotive industry lost Rs 2,300 crore per day and an estimated 3.45 lakh jobs because of the pandemic.
- The large-scale diversion of oxygen from industrial units to hospitals poses additional challenges to the already struggling manufacturing sectors like steel, cement, and mining, which rely on oxygen for moulding, fabrication, and so on.
- The MSME (Micro, Small and Medium Enterprises) sector is labour-intensive and the lifeline of India’s manufacturing sector, almost entirely supplying other industries.
- Manufacturing production cuts have had a cascading negative impact on the component industries, primarily halting operations of MSMEs engaged in small and spare parts manufacturing.
Pharma industry: Given the medical emergency, the demand for and supply of pharmaceutical products in India has increased rapidly. Even though India is one of the world’s top formulation drug exporters, the domestic pharmaceutical industry is heavily reliant on bulk drug imports. According to reports, India imported approximately Rs 24,900 crore in bulk drugs in FY19, accounting for approximately 40% of total domestic consumption. With China accounting for nearly 70% of India’s API (Active pharmaceutical ingredient) imports by value, importers face supply disruptions and unexpected price fluctuations. Many critical antibiotics and antipyretics are entirely dependent on Chinese imports. Because of lockdowns, distributors also experienced transportation issues when delivering medicines to other states.
Covid-19: Impact on Service Sector
- According to the Economic Survey 2021-22, India’s services sector, which contributes more than 50% of the country’s GDP, has been the worst affected by the COVID-19 pandemic.
- The segments involving human contact, and its share of India’s Gross Value Added (GVA) has declined from 55% in 2019-20 to 53% in 2021-22.
- While non-contact services such as information, communication, financial, professional, and business services have held up well, the impact on contact-based services such as tourism, retail trade, hotel, entertainment, and recreation, and so on has been much more severe.
- The spread of corona virus had also impacted the aviation industry. Domestic carriers in India have been forced to cancel or temporarily suspend flights due to the outbreak.
- Following a strong performance in 2019, the COVID-19 outbreak,and the Centre’s containment measures have resulted in a significant drop in foreign and domestic travel, across both the tourism and business traveller segments.
