The Impact of The Lockdown on The Economy - Part 2

Economic landscape post lockdown :

1. People will have to work extra hours to pull the economy out of the slump.

2. Construction and service sectors (contributing to about half of the GDP) are facing huge losses, the banking sector is already crippling with a bad loan crisis, insurance companies may have to witness their businesses becoming unviable depending on the claims that will be made when things settle.

3. Get ready to face all sorts of shortages as a consequence of the curtailment of production and distribution.

4. The collapse and deductions in incomes will reduce the consumption demand, which is the bedrock of our economy.

5. Many small entrepreneurs will be and are already being wiped out because of low revenue.

6. Private investors are suffering great losses; they may end up not investing in anything due to this uncertainty.

7. There will be a stark rise in poverty and unemployment.

8. A fall in GDP will give scope to a long and deep recession.

9. A shortage of money may lead to deflation. However, it’s still ambiguous about inflation.

10. The decrease in government income and increased crime rates.

The list is never-ending because everything is interlinked, the burden may not get equally distributed but all of us will be a stakeholder in the downfall.

Isn’t it scary? If we do not take into account the economic damage, it will cause more problems than the virus itself moving forward. Before the health pandemic turns into an economic catastrophe beyond repair, we need to develop ways to deal with the current problem. As the fears of recession loom over our country with acutely volatile market conditions, this pandemic has been able to hold up an unflattering mirror to the rich, and has been able to lay the unfair burden on ordinary people- the frustration created out of it may end up feeding protectionism, xenophobia and government interference at a higher scale.

Written by: Shifa Munshi and Ritika