NEW DELHI – The coronavirus is battering India’s battered economy, mounting pressure on Prime Minister Narendra Modi to nurture a nascent recovery and get the country back to work.
The corona virus that hit two waves has died hundreds of thousands of people and sometimes brought cities to a halt. Infections and deaths have decreased and the country is returning to work. Economists expect growth on paper to pick up in the second half of the year.
Even so, it can take years to undo the damage. According to credit rating agency India Ratings, economic output for the April-June period this year was 9.2 per cent lower than in the same period of 2019.
Coronavirus has essentially robbed India of the momentum India needs to provide jobs for its young and rapidly growing workforce. it has also increased long term problems What were already dragging growth down, such as high debt, lack of competition with other countries, and policy mistakes.
Economists are particularly concerned about the slow rate of vaccination and its potential a third wave of Coronavirus, which can prove to be disastrous for any economic recovery.
“Vaccination Progress Remains Slow,” Just. with 11 percent Priyanka Kishor, head of India and Southeast Asia at Oxford Economics, said at a research briefing last week that the vaccine has been fully vaccinated so far. The firm cut its growth rate for 2021 from 9.1 percent to 8.8 percent.
Even a rise of 8.8 percent would be a strong number in better times. Compared to the previous year, India’s economy grew by 20.1 per cent from April to June, according to estimates released by the Ministry of Statistics and Program Implementation on Tuesday evening.
But those comparisons benefit from a comparison with India’s dismal performance last year. The economy shrank 7.3 percent last year after the government shut down the economy to contain the first wave of the coronavirus. because of which big job loss, is now one of the biggest hurdles that is holding back growth, say experts.
Mahesh Vyas, chief executive of the Center for Monitoring Indian Economy, said real household income declined further this year. “Unless it is repaired,” he said, “the Indian economy cannot bounce back.”
Mr Vyas estimates that at least 3.2 million Indians lost stable, well-paid salaried jobs in July alone. Small traders and daily wage workers suffered more job losses than others during the lockdown, although they were able to go back to work once the restrictions were lifted, Mr Vyas said. report good this month.
“Salaried jobs are not equally elastic,” he said. “Recovering a lost salaried job is difficult.”
Mr Vyas said around 10 million people have lost such jobs since the start of the pandemic.
Mr Modi’s government this month took steps to revive the economy stake sale State-owned assets such as airports, railway stations and stadiums are worth about $81 billion. But economists broadly see the policy as a cash-generating move in the short term. He says it remains to be seen whether this will lead to further investment.
“The whole idea is that the government will borrow this money from the domestic market,” said Devendra Kumar Pant, chief economist, India Ratings. “But what happens if the project goes to a domestic player and has to borrow in the domestic market? Your credit demand will not change domestically.”
Dr. Pant said questions remain as to how long private companies will be willing to retain those assets and how the monetization policy will ultimately affect prices for consumers.
Understand the Vaccine and Mask Mandate in America
- Vaccine Rules. On August 23, Food and Drug Administration Pfizer-BioNtech’s corona virus vaccine gets full approval Leads the way for increased mandates, both in the public and private sectors, for those aged 16 and over. private companies have been increasingly mandatory vaccines for employees. such mandates legally permitted and has been upheld in court challenges.
- mask rule. Centers for Disease Control and Prevention in July recommended That all Americans, regardless of vaccination status, wear masks in indoor public places within areas experiencing outbreaks, a reversal of guidance given in May. See where CDC guidance will apply, and where States have established their own mask policies. Mask battles have become controversial in some states, with some Local leaders defying state restrictions.
- Colleges and Universities. More than 400 colleges and universities require students to be vaccinated against COVID-19. Almost all are in states that voted for President Biden.
- schools. Both california And New York City Vaccine mandate for education workers is introduced. A survey released in August found that many American parents of school-age children were opposed to compulsory vaccines for students, but were More support of the mask mandate for students, teachers and staff members who don’t have their shots.
- Hospitals and Medical Centers. Many hospitals and major health systems require employees to receive the COVID-19 vaccine, Citing the growing caseload fueled by the Delta variant and the stubbornly low vaccination rates in their communities, even within their work force.
- New York City. Proof of vaccination required for workers and customers indoor dining, gym, performance and other indoor conditions, although enforcement doesn’t begin until September 13. Teachers and other education workers Without the option of weekly testing, the city’s sprawling school system would require at least one vaccine dose by September 27. city hospital staff Should also be vaccinated or subject to weekly testing. Similar rules apply for New York state employees.
- at the federal level. Pentagon announces it wants to make coronavirus vaccination mandatory for the country 1.3 million active-duty soldiers “No later than” mid-September. President Biden announced that All Civilian Federal Employees It would have been can be vaccinated against coronavirus Or introduce routine testing, social distancing, mask requirements and restrictions on most travel.
“In India, things will get worse instead of improving,” he said, adding that the cost to users of highways and other infrastructure could increase.
During the second wave in May, Mr. Modi resisted calls from several epidemiologists, including Dr. Anthony Fauci, director of the US National Institute of Allergy and Infectious Diseases, to call for a resumption of the nationwide lockdown. .
The lockdown in 2021 was not as severe as last year’s nationwide restrictions, which Evicted millions of people from cities And in rural areas, often on foot because rail and other transport was suspended.
During the second wave, major infrastructure projects across the country, which employ lakhs of domestic migrant workers, were exempted from restrictions. More than 15,000 miles of Indian highway projects continued, along with improvements to the rail and city metro.
On Tuesday, Dr. Pant said India’s 20.1 per cent growth forecast for the April-to-June period was nothing but an “illusion”. development contracted so fast With a record 24 per cent growth, around the same period last year, that double-digit gain this year will leave the economy behind where it was two years ago.
Economists say India needs to spend, even as spending, to unlock the full potential of its vast low-skilled workforce. “Very simple primary health facilities, primary services are needed to provide nutrition to the children,” said Mr. Vyas. “These are all highly labor intensive jobs, and they are largely government services.”
Mr Vyas said one of the reasons why Indian governments generally do not spend in those areas is because it is considered a “not a working thing”. Another is the government’s “radical fixation” with keeping the fiscal deficit under control, he said. Shri Vyas said that the government cannot depend solely on the private sector for employment generation.
“The only solution,” he said, is for the government to spend and boost private investment. “You have a de-motivated private sector because there is not enough demand. That is what is holding India back.”