Minor Project Report

On

ECONOMIC IMPACT ON INDIA POST CORONAVIRUS-ERA

Submitted in Partial Fulfillment for the Award of the

Degree of BBA 2021-2024

Under the Guidance of: Submitted By:

MRS. SHWETA RASTOGI URVI MISHRA

(Assistant Professor) (10114701721)

Maharaja Agrasen Institute of Management Studies

Affiliated to Guru Gobind Singh Indraprastha University,
Delhi PSP Area, Plot No. 1, Sector 22, Rohini, Delhi 110086, India
 Student Declaration

This is to certify that I, URVI MISHRA have completed the Project Report titled ECONOMIC

IMPACT ON INDIA POST CORONAVIRUS ERA under the supervision of MRS. SHWETA

RASTOGI (ASSISTANT PROFESSOR) toward partial fulfillment of the requirement for the

award of the Degree of Bachelor of Business Administration at Maharaja Agrasen Institute of

Management Studies, Delhi. This is an original piece of work and I have not submitted it earlier

elsewhere.

(Signature)

Name of the Student:……………………

University Enrolment No………………..
Program………………………………….
Batch…………………………………….
Date:……………………………………..

COUNTERSIGNED BY:
 ACKNOWLEDGEMENT

I would also like to thank our Director, DR. RAJANI MALHOTRA DHINGRA and
our HOD, DR. MANOJ VERMA, for providing me with this wonderful opportunity
to work on a project with the topic ECONOMIC IMPACT ON INDIA POST
CORONAVIRUS-ERA This project would not have been accomplished without their
help and insights. I would also like to express my heartfelt thanks to my Project
Supervisor MRS. SHWETA RASTOGI for giving his/her support, guidance and
encouragement throughout the project work.

Last but not the least I would like to thank my parents, family and friends who
have directly or indirectly contributed in making this project a success.

Name of the Student: ……………………

University Enrolment No: ……………………

Program & Section:………………………………………

Batch:……………………
 EXECUTIVE SUMMARY

This project includes the critical analysis of five fashion luxury brands i.e. introduction
to the industry, its history, introduction to all five fashion brands, their history, their
SWOT Analysis, their marketing strategies. It also includes their revenue and profits of
last 2 years and their losses. It also includes their hidden facts.

This project also includes the questionnaire depicting the survey population
preferences over their dream brands, their purchases, their comfort zone in different
brands. This project also includes the brands and company history and how vast are
they spread. It also provides the pandemic effects over the brands, the effects over the
industry during the pandemic , how the brands started their virtual fashion meets.

Ever since the outbreak of the COVID-19 has occurred, the whole world has witnessed
economic and financial crunches. The economy of the whole world has stopped and
lockdown are imposed in majority of the countries which has further escalated the
problem. As a result, the purpose of this research is to understand the impact that the
COVID-19 on the economy of India and to analyze the role of digitalization on the
sustainability. The objectives of the research are to determine the impact that COVID-
19 pandemic had on the overall economy of India, to determine the role of digitalization
on the sustainability, Digitalisation plays an essential part in global growth and has a
huge influence on the lives of people. With strong digital collaboration and connexions
between researchers and policy makers, it is important to utilise the maximum capacity
for digitalization. As our agricultural property, our habitats and urban areas alter, our
approaches to solving global problems can continue to grow,to analyze how
sustainability can be improved using digitalization in COVID-19 pandemic, and to
analyze the impact of the Covid-19 on the consumer behavior towards the luxury
products like car. For this, the research methodology that has been used is the
Positivism philosophy and deductive approach and the primary data has been collected
using the survey strategy so that multi-method of data formation can be put to use. It
has been analyzed and found out that managing stress is the most crucial priority of the
consumer in the pandemic and the purchasing habits of consumers have slightly
changed as consumers are purchasing essential products majorly in the pandemic.
 TABLE OF CONTENTS
S.No. Topic Pages
1. Introduction to the Economy 4-10

2. Introduction to the topic 11-28

3. Research Methodology 28-32

• Meaning of Research
• Objectives of the study (Minimum 3
objectives in points)
• Scope of the study
• Research Design (Meaning) & Types of
Research Design (Exploratory or
Descriptive)
• Sample size, Sampling technique
• Data Collection/Data Sources

4. Findings & Observations (in Points) 33-43

5. Conclusion (in Paragraph) 44-45
6. References and Bibliography 46
7. Annexure 47-
 ECONOMIC IMPACT ON INDIA POST CORONAVIRUS-ERA

GLOBAL ECONOMIC IMPACT

The outbreak of COVID-19 caused a massive economic recession, with six out of the
seven largest economies showing a massive GDP loss in the third quarter of 2020. A
slump in demand and changing consumption patterns shook international trade
worldwide. Since March 2020, lockdowns became a global necessity, and the Indian
subcontinent was no exception, announcing its first nation-wide lockdown by the end
of March. Aimed at getting hold of the infectious chains, the lockdown resulted in a
massive decrease in mobility, but also meant that livelihoods were disproportionately
impacted. This was especially true for those with daily or hourly wages across the
country.

COVID-19 IMPACT ON DIFFERENT SECTORS

Reduced mobility and the unavailability of resources, due to restricted borders caused
significant challenges to traditional retailers. The automotive industry, in particular,
emerged as one of the worst impacted industries. Simultaneously, petroleum
consumption decreased. Other industries such as healthcare or fast-moving consumer
goods, were less affected due to their indispensability and local shopper clientele. E-
commerce experienced a long-lasting benefit from the pandemic, as most online
purchasers consider e-retail as a post-pandemic option.

The economic impact of the COVID-19 pandemic in India has been largely
disruptive. India's growth in the fourth quarter of the fiscal year 2020 went down to
3.1% according to the Ministry of Statistics. The Chief Economic Adviser to the
Government of India said that this drop is mainly due to the coronavirus pandemic
effect on the Indian economy. Notably, India had also been witnessing a pre-
pandemic slowdown, and according to the World Bank, the current pandemic has
"magnified pre-existing risks to India's economic outlook".

The World Bank and rating agencies had initially revised India's growth for FY2021
with the lowest figures India has seen in three decades since India's economic
liberalization in the 1990s. However, after the announcement of the economic
package in mid-May, India's GDP estimates were downgraded even more to negative
figures, signalling a deep recession. (The ratings of over 30 countries have been
downgraded during this period.) On 26 May, CRISIL announced that this will perhaps
be India's worst recession since independence. State Bank of India research estimates
a contraction of over 40% in the GDP in Q1. The contraction will not be uniform,
rather it will differ according to various parameters such as state and sector. On 1
September 2020, the Ministry of Statistics released the GDP figures for Q1 (April to
June) FY21, which showed a contraction of 24% as compared to the same period the
year before.

According to Nomura India Business Resumption Index economic activity fell from
82.9 on 22 March to 44.7 on 26 April. By 13 September 2020 economic activity was
nearly back to pre-lockdown. Unemployment rose from 6.7% on 15 March to 26% on
19 April and then back down to pre-lockdown levels by mid-June. During the
lockdown, an estimated 140 million (140 million) people lost employment while
salaries were cut for many others. More than 45% of households across the nation have
reported an income drop as compared to the previous year. The Indian economy was
expected to lose over ₹32,000 crore (US$4.0 billion) every day during the first 21-days
of complete lockdown, which was declared following the coronavirus outbreak. Under
complete lockdown, less than a quarter of India's $2.8 trillion economic movement was
functional.Up to 53% of businesses in the country were projected to be significantly
affected. Supply chains have been put under stress with the lockdown restrictions in
place; initially, there was a lack of clarity in streamlining what an "essential" is and
what is not

Even before the full force of the pandemic hit India (which was really in April-
June quarter in terms of livelihoods; and July onwards in terms of lives with both
cases and deaths rising), the slowdown was already worse than the one the Indian
economy went through in 2011-12.

The Indian economy was in one of its worst ever deceleration phases even before the
Covid-19 pandemic. GDP growth fell continuously for eight quarters (except for a .08
percentage point blip between December 2018 and March 2019. It was 8.2% in March
2018 and had fallen to just 3.1% in March 2020. March saw just a week of the
lockdown (which would eventually last 68 days, albeit with some relaxations).
The Indian economy was in one of its worst ever deceleration phases even before the
Covid-19 pandemic. GDP growth fell continuously for eight quarters (except for a .08
percentage point blip between December 2018 and March 2019. It was 8.2% in March
2018 and had fallen to just 3.1% in March 2020. March saw just a week of the lockdown
(which would eventually last 68 days, albeit with some relaxations).

Even before the full force of the pandemic hit India (which was really in April-June
quarter in terms of livelihoods; and July onwards in terms of lives with both cases and
deaths rising), the slowdown was already worse than the one the Indian economy
went through in 2011-12.
Back then, quarterly GDP growth fell from 10.3% in March 2011 to 4.9% in June
2012. However, the economy started recovering after 2011-12. Annual GDP growth
fell from 8.5% in 2010-11 to 5.2% in 2011-12. This contraction was followed by a
sharp recovery until 2016-17. This has not been the case this time and GDP growth
has been falling continuously since 2017-18.

As per the official data released by the ministry of statistics and program
implementation, the Indian economy contracted by 7.3% in the April-June quarter of
this fiscal year. This is the worst decline ever observed since the ministry had started
compiling GDP stats quarterly in 1996. In 2020, an estimated 10 million migrant
workers returned to their native places after the imposition of the lockdown. But what
was surprising was the fact that neither the state government nor the central government
had any data regarding the migrant workers who lost their jobs and their lives during
the lockdown.

The government extended their help to migrant workers who returned to their native
places during the second wave of the corona, apart from just setting up a digital-
centralized database system. The second wave of Covid-19 has brutally exposed and
worsened existing vulnerabilities in the Indian economy. India’s $2.9 trillion economy
remains shuttered during the lockdown period, except for some essential services and
activities. As shops, eateries, factories, transport services, business establishments were
shuttered, the lockdown had a devastating impact on slowing down the economy. The
informal sectors of the economy have been worst hit by the global epidemic. India’s
GDP contraction during April-June could well be above 8% if the informal sectors are
considered. Private consumption and investments are the two biggest engines of India’s
economic growth. All the major sectors of the economy were badly hit except
agriculture. The Indian economy was facing headwinds much before the arrival of the
second wave. Coupled with the humanitarian crisis and silent treatment of the
government, the covid-19 has exposed and worsened existing inequalities in the Indian
economy. The contraction of the economy would continue in the next 4 quarters and a
recession is inevitable. Everyone agrees that the Indian economy is heading for its full-
year contraction. The surveys conducted by the Centre For Monitoring Indian Economy
shows a steep rise in unemployment rates, in the range of 7.9% to 12% during the April-
June quarter of 2021. The economy is having a knock-on effect with MSMEs shutting
their businesses. Millions of jobs have been lost permanently and have dampened
consumption. The government should be ready to spend billions of dollars to fight the
health crisis and fast-track the economic recovery from the covid-19 instigated
recession. The most effective way out of this emergency is that the government should
inject billions of dollars into the economy.

EFFECT ON COMMERCE AND TRADE MINISTRY POST CORPNAVIRUS

ERA:

GLOBAL TRADE:

Global trade is slowing sharply and is expected to worsen in 2023 in the wake of rising
uncertainties and deteriorating economic conditions. Global trade, especially goods
trade had slowed in 2022 as supply chains continued to get disrupted by the lingering
effects of the pandemic along with the geo-political tensions. The World Trade
Organization (WTO) in October 2022 had projected the world merchandise trade
volume to grow by 3.5 per cent in 2022 and 1.0 per cent in 2023, as compared to a high
growth of 9.7 per cent in 2021. While the forecast of 3.5 per cent for 2022 is slightly
better than 3.0 per cent forecasted in April 2022, the forecast of 1.0 per cent for 2023
is a sharp fall from 3.4 per cent forecasted in April 2022. Significant regional disparities
persist, with some regions falling well short of the global average. The latest projections
of WTO show the Middle East to have the strongest trade volume growth in 2022 for
export as well as imports. However, both exports and imports of Commonwealth of
Independent States (CIS) is projected to record negative growth in 2022.

INDIAN MERCHANDISE TRADE:

India’s Merchandise exports had shown resilience and continue to offer bright prospects
for India’s growth revival, despite multiple challenges. Merchandise exports touched a
record US$ 422 billion in 2021-22 surpassing the US$ 400 billion target set for the year
and registering an impressive growth of 44.62 per cent over US$ 291.8 billion during
2020-21. A similar approach has again been followed to monitor and boost exports in
2022-23. During April-December 2022 (QE), merchandise exports were US$ 332.76
billion as against US$ 305.04 billion during April- December 2021. Merchandise
imports during 2021-22 registered an increase of 55.43 per cent from US$ 394.44
Billion in 2020-21 to US$ 613.05 Billion in 2021-22. Imports during April- December
2022 stood at US$ 551.70 billion as compared to US$ 441.50 billion during April-
December 2021. The trade deficit in 2021-22 was estimated at US$ 191.05 billion as
against the deficit of 102.63 billion in 2020-21. In April- December 2022, trade deficit
increased to US$ 218.94 billion from US$ 136.45 billion in April- December 2021.

INDIAN SERVICE TRADE:

The services sector has been the dominant sector in India’s GDP, with significant
contribution to exports and FDI. The pandemic has had a significant impact on the
economic growth, however, the services sector has shown resilience to the economic
disruptions. Services exports in 2021-22 stood at US$ 254.53 billion as compared to
US$ 206.09 billion in 2020-21, with a growth of 23.5 per cent. India’s services export
is estimated at US$ 235.81 billion during April- December 2022 as compared to US$
184.65 billion during April-December 2021, a positive growth of 27.71 per cent.

Services imports were US$ 147.01 billion in 2021-22 as compared to US$ 117.52
billion in 2020-21, with a growth of 25.09 per cent. The estimated value of imports
during AprilDecember 2022 was US$ 134.99 billion as compared to US$ 105.45 billion
during April- December 2021.A surplus of US$ 107.52 billion and US$ 100.82 billion
was generated in services trade in 2021-22 and April- December 2022 respectively.
INITIATIVE TAKEN BY THE COMMERCE AND TRADE MINISTRY TO
IMPROVE THE ECONOMY:

1) The Foreign Trade Policy 2015-20 has been extended upto 31st March 2023.

2) Districts as Export Hubs initiative has been launched by identifying products with
export potential in each district, addressing bottlenecks for exporting these products
and supporting local exporters/ manufacturers to generate employment in the district.

3) Assistance provided through several schemes to promote exports like Trade

Infrastructure for Export Scheme (TIES) and Market Access Initiatives (MAI) Scheme.

4) Interest Equalization Scheme on pre and post shipment rupee export credit has
been extended upto 31st March 2024.
5) India-UAE Comprehensive Economic Partnership Agreement (CEPA) was signed
on 18th February 2022 and entered into force on 1st May 2022.

6) India-Australia Economic Cooperation and Trade Agreement was signed on 2nd

April 2022 and entered into force on 29th December 2022.

7) Common Digital Platform for Certificate of Origin has been launched to facilitate
trade and increase Free Trade Agreement (FTA) utilization by exporters.

8) Active role of Indian missions abroad towards promoting India’s trade, tourism,
technology and investment goals has been enhanced.

STATE OF RECOVERY:

The Indian economy, however, appears to have moved on after its encounter with the
pandemic, staging a full recovery in FY22 ahead of many nations and positioning itself
to ascend to the pre-pandemic growth path in FY23. Yet in the current year, India has
also faced the challenge of reining in inflation that the European strife accentuated.
Measures taken by the government and RBI, along with the easing of global commodity
prices, have finally managed to bring retail inflation below the RBI upper tolerance
target in November 2022. However, the challenge of the depreciating rupee, although
better performing than most other currencies, persists with the likelihood of further
increases in policy rates by the US Fed. The widening of the CAD may also continue
as global commodity prices remain elevated and the growth momentum of the Indian
economy remains strong. The loss of export stimulus is further possible as the slowing
world growth and trade shrinks the global market size in the second half of the current
year. Despite these, agencies worldwide continue to project India as the fastest-growing
major economy at 6.5-7.0 per cent in FY23. These optimistic growth forecasts stem in
part from the resilience of the Indian economy seen in the rebound of private
consumption seamlessly replacing the export stimuli as the leading driver of growth.
The uptick in private consumption has also given a boost to production activity resulting
in an increase in capacity utilisation across sectors. The rebound in consumption was
engineered by the near-universal vaccination coverage overseen by the government that
brought people

back to the streets to spend on contact-based services, such as restaurants, hotels,

shopping malls, and cinemas, among others. The world’s second-largest vaccination
drive involving more than 2 billion doses also served to lift consumer sentiments that
may prolong the rebound in consumption. Vaccinations have facilitated the return of
migrant workers to cities to work in construction sites as the rebound in consumption
spilled over into the housing market. This is evident in the housing market witnessing
a significant decline in inventory overhang to 33 months in Q3 of FY23 from 42 months
last year. The Capital Expenditure (Capex) of the central government, which increased
by 63.4 per cent in the first eight months of FY23, was another growth driver of the
Indian economy in the current year, crowding in the private Capex since the January-
March quarter of 2022. On current trend, it appears that the full year’s capital
expenditure budget will be met. A sustained increase in private Capex is also imminent
with the strengthening of the balance sheets of the Corporates and the consequent
increase in credit financing it has been able to generate. A much-improved financial
health of well-capitalised public sector banks has positioned them better to increase the
credit supply.

EFFECT ON FINANCE MINISTRY POST CORPNAVIRUS ERA:

The Covid-19 global pandemic was a double blow for the already struggling Indian
economy. According to the World Bank, the current pandemic has ‘magnified pre-
existing risks to India’s economic outlook’.

What began as a health crisis, quickly extended into a business crisis. Hardly any
business sector has been left untouched by the Covid-19 outbreak: aviation, tourism,
manufacturing, transport, banking, financial services and insurance (BFSI), and retail
sectors top the list.

In March, India imposed a nationwide lockdown with the hope of containing the
outbreak. The Indian lockdown, which lasted for almost three months, supposedly had
the most stringent lockdowns the world had seen.

To steer the country through these unprecedented times, India’s central bank (the
Reserve Bank of India) and the Indian government implemented several measures:
fiscal, legislative and operational. The Government of India began a series of
initiatives. All non-essential services in the country were halted (insurance was
classified as essential), and an aid package of more than USD 260bn was made
available with aim of creating a self-reliant India. Several labour law initiatives were
also undertaken. Healthcare also witnessed a drastic shift with the opening-up of the
telemedicine in India with remote treatments being made accessible.

In April 2020, India also changed in foreign investment policy to curb ‘opportunistic
takeovers/acquisitions of Indian companies due to the current pandemic’. The revised
policy ensures that all foreign investments from countries that share a land border
with India will now be under scrutiny of the Indian Ministry of Commerce and
Industry.
SHOCK FOR THE CLIENTS AND MICROFINANCE INSTITUTIONS:

The pandemic triggered new challenges for both clients and microfinance institutions
(MFIs). Evidence points to clients’ precipitous loss of income, depletion of meager
savings, increasing indebtedness, and difficult coping strategies that risk pushing
millions back into poverty. MFIs had to quickly adapt, which accelerated trends
toward digitalization and virtual connectivity with clients. Households struggled to
understand the implications of MFIs’ loan repayment moratoriums and confronted
hard choices between daily needs, repaying loans, and conserving cash for an
uncertain future.

Early in the outbreak, MFIs were hit hard. The microfinance model relies on frequent
physical interaction with customers. Lockdowns brought operations to a standstill and
repayments came under pressure, creating liquidity issues, particularly for non-bank
(NBFC) MFIs.

The impact was stark:

• Disbursements from April to June 2020 fell to Rs 61.9 billion (~$800 million)
compared to where they had been pre-COVID at Rs 711.9 billion (~$9.2
billion).
• Portfolio at risk (PAR) rose; PAR>30 days peaked at 22 percent in June 2021
and has improved considerably since.
• Unemployment jumped to 24 percent in 2021.
• The Perodic Labour Force Survey from July 2020- June 2021 showed a
migration rate of 48 percent among urban women in India and 23 percent
among urban males, more than half of whom returned to their rural homes;
possibly the country’s worst reverse migration.

POLICY RESPONSES:

The public sector led crisis response, mitigating damage and helping relaunch the
economy. Since 2020, both the Reserve Bank of India (RBI) and the Government of
India have taken critical actions for microfinance clients and institutions.

RBI’s twin approach included liquidity injection and restructuring. RBI allowed
lenders to offer moratoriums on loan repayments and directed maintaining an
account’s status in credit bureau reporting while in moratorium to protect customers’
credit histories and access to credit in the future. The moratorium severely stressed
NBFC-MFIs. A survey amongst Microfinance Institutions Network (MFIN) members
in June 2021 found NBFC-MFIs had moratorium for approximately one-third of
repayment installments—creating tremendous pressure to manage liquidity given that
NBFC-MFIs rely on customer repayments to repay their own debt obligations. And
with fixed salary and infrastructure costs, most MFIs have little leeway to quickly
change operational costs.

For MFIs, RBI also launched special liquidity de-stressing schemes and relaxed loan
provisioning requirements. The Ministry of Finance supplemented the efforts with
partial credit guarantees, an “ex-gratia” scheme to pay the difference between
compound and simple interest for six months for specified loan types, and the PM
Svanidhi Schemes of lending and credit guarantees to assist street vendors. However,
while helpful, these measures could not fully relieve lenders’ liquidity challenges.

The situation improved in September 2020 as customers’ repayments resumed. In

parallel, policymakers recognized the significance of microfinance for inclusive
growth, giving a strong recovery signal to the market.

But the microfinance sector entered the 2021–2022 financial year facing an uncertain
and unprecedented impact of COVID-19: a second wave of infections and partial
lockdowns again hurt customers’ livelihoods and limited lenders’ operational
mobility. The government developed another credit guarantee schemes for a yet
broader array of MFIs, building on suggestions from MFIN, which worked closely
with the Ministry of Finance.

FINANCIAL INSTITUITONS RESPONSES:

In parallel, lenders faced daunting challenges in managing ongoing connections with

customers, continuing operations amidst restrictions, ensuring employee safety,
managing liquidity to cover operational costs and debt obligations, and adapting
operations to accelerate the use of mobile phones and digital payments. Lenders
needed to balance expectations among customers, employees, and investors, while
continuously weighing multiple and rapidly changing variables around the
unpredictable pandemic, lockdowns, and economic recovery.

While the RBI’s loan repayment moratorium gave immediate relief, related
calculations were confusing. Customers found it difficult to understand how the
moratorium would impact their repayments and costs and struggled to make informed
choices. Restrictions on mobility and group meetings made explaining even harder for
lenders. Customers also questioned—rightly so—the logic and ethics of accrued
interest; they felt repayment delays were beyond their control, entirely attributable to
the pandemic. Varied approaches amongst the lenders, for example about interest
accrual, revising loan tenure, and installment amounts, and timing of interest
collection during the moratorium, further confounded the issue. Lenders and MFIN
made several efforts such as audio-visuals, direct calling to customers, awareness
campaigns, and dedicated mobile apps catering to specific customer needs.

Another critical challenge was ensuring fair and respectful interaction with customers.
Higher delinquencies, pressure for collections on the lenders’ side, customer
hardships, and confusion about loan information created stressful interactions.
Handling such tensions required a balanced approach combining transparency,
patience, and empathy. This meant educating customers about the moratorium and
implications of their choices and using objective criteria for assessing stressed
customers.

Maintaining microfinance’s classic close and frequent interaction with customers

while following COVID protocols required new approaches. Lenders extensively
turned to live or automated phone calls. To ensure employees interacted appropriately
with customers, lenders organized special training on customer interactions and phone
etiquette. For field interactions, lenders split groups and met smaller subgroups in
larger open spaces. Further, many MFIs supported customers with emergency aid for
health, food, and essential supplies. In parallel, at the employee level, MFIs added
controls to monitor repayments, aiming to avoid misinformation, misbehaviour,
forced collections, and embezzlement by field-level employees.

CONCLUSION ON 5 LESSONS TAKEN FROM COVID CRISIS BY THE

FINANCE SECTOR:

1. Severe shock cannot be met by institutions on their own and requires

both monetary and fiscal support to avoid systemic instability: Support
was provided swiftly and decisively by the RBI and Government of India,
working closely with self-regulatory organizations and microfinance lenders.
2. Capacity building for MFI customers and employees is critical: Customers
demonstrated tremendous adaptability to new conditions, including
lockdowns, digital payments, and lenders’ new customer service approaches.
However, lenders needed sustained efforts in capacity building for customers
and employees to help them adjust.
3. Customers maintained resilience to economic shocks: Microfinance clients’
activities are typically integral to community life, like selling vegetables,
groceries, or other core consumption items, so they are less affected by
macroeconomic shocks.
4. Customers value MFIs that are dependable, support clients, and provide
responsible financial services: During the crisis, customers worked carefully
with microfinance providers to avoid triggering adverse repayment records
that would jeopardize future access to financial services.
5. MFIs and their investors need to set realistic expectations for institutional
performance amid unprecedented crises: During the pandemic, institutions
that were responsive to individual client situations balanced institutional needs
with client realities through repayment delays, extending loan tenures, and
providing new loans. Institutions in India that responded with empathy during
the crisis have been rewarded with higher client retention, loyalty, and overall
improved recovery post-pandemic.

EFFECT ON HEALTH AND FAMILY MINISTRY POST CORPNAVIRUS ERA:

With the COVID-19 pandemic testing even the more developed healthcare systems
globally, the foundations of India’s healthcare system have naturally also been
shaken. The overall response to the pandemic witnessed both the private and
government sector working in tandem. The private Indian healthcare players rose to
the occasion and have been providing all the support that the government needs, such
as testing, isolation beds for treatment, medical staff and equipment at government
COVID-19 hospitals and home healthcare.

India’s private healthcare sector has contributed significantly and accounts for about
60 per cent of inpatient care. Most private facilities initiated their plans in response to
the COVID-19 pandemic, which involved significant investments to prepare facilities
for controlling and preventing the infection, building infrastructure for quarantine and
treatment, and equipping the facility with suitable medical supplies and additional
workforce. Additionally, hospitals and labs witnessed a sharp decline in revenue due
to delayed medical tourism and elective processes (the pandemic is speculated to trim
the private hospitals’ operational profit by approximately 40 per cent this fiscal year).
The OPDs (outpatient departments) had also been closed almost throughout the year
as per the government advisory.
The healthcare industry, along with the central and state governments, undertook a
robust response plan to tackle the pandemic by setting up of dedicated COVID-19
hospitals, isolation centres and tech-enabled mapping of resources. In order to
effectively manage the outbreak, the Indian government also leveraged technology
and developed various applications both at the central and state-levels. The Aarogya
Setu mobile app which assisted in syndromic mapping, contact tracing and self-
assessment was widely used throughout the country. Such technology platforms were
used to supplement the response management, which included delivery of essential
items in containment zones, tele-consultations with patients, bed management and
real-time monitoring and review by the authorities.

INVESTMENT IN INDIA’S HEALTHCARE SECTOR:

Despite initial hiccups, the healthcare system in India managed to withstand the
pandemic. The various efforts in manufacturing of medical equipment, disposables,
drugs and the most recent vaccine efforts made by India has placed us as a global
leader. India not only fulfilled the domestic requirements, but also rose to the
occasion and supported other countries. The healthcare sector, therefore, as an
investment opportunity looks promising. A few factors encouraging future
investments in the sector are:

• Medical infrastructure in Tier II and III cities: The shortfalls such as

the required number of beds or the accessibility of advanced equipment that
were highlighted during the worst-hit times of the pandemic are
highlighting the need for a healthcare system that is ‘emergency-proof’ for
such situations in the future. Hospital chains and specialty centres are
coming forward to build more capacities, especially in Tier II and III cities.
Numerous hospital chains have started expanding in these cities by setting
up small clinics and associating with reputed local doctors. This is also
aligned with government efforts to increase the number of hospital beds per
thousand population and close the accessibility gap mainly in sub-urban
and rural parts of the country.
• Health insurance awareness: There has been an increased awareness of
health insurance products in the past few years and more people are
investing in health insurance with each passing year.
• Government policies: Though planned before the pandemic, government
efforts in achieving a universal health cover under ‘Health for All’ and
schemes, such as Ayushman Bharat and National Digital Health Mission
have sped up exponentially. These efforts to make healthcare affordable
and accessible for the entire population also offer scope for private players
to widen their reach and presence.
• Medical tourism: The healthcare sector in India is attractive to foreign
patients because of the availability of quality services at relatively lower
costs compared to countries in Western Europe or the U.S. As of 2012,
Bangladesh (22 per cent) accounted for the highest number of medical
FTAs (foreign tourist arrivals) whereas Maldives, Afghanistan and Iraq
accounted for 17 per cent, 9 per cent and 8 per cent, respectively.
 • Use of technology: Online consultations and technology platforms are in
high demand especially in today’s times. In August 2019, the Ministry of
Health and Family Welfare introduced the ‘eSanjeevani’ app, an integrated
web-based telemedicine solution. It aims at making healthcare services fair
by bridging the gap between urban and rural India.

THE PROGNOSIS IS POSITIVE:

Driven by better healthcare awareness, rise in incomes, increased access to insurance
and lifestyle-related diseases, India’s healthcare market is expected to reach USD372
billion by 2022. The Indian government aims at increasing the healthcare spending to
2.5 per cent of the GDP (gross domestic product) by 2025.The COVID-19 pandemic
has also transformed the way the government and private players are planning to
bring change in the healthcare system. There has been an increased focus on
telemedicine services and the government also issued new guidelines to make
telemedicine a legal practice in India. The Ministry of Health and Family Welfare
(MoH&FW), along with NITI Aayog has rolled out the new guidelines that will allow
registered medical practitioners (RMPs) to provide healthcare services using
telemedicine[6]. Furthermore, the government has also launched the NDHM (National
Digital health Mission) to address the country’s health crisis. The major components
of this mission encompass telemedicine, health IDs, health records, along with e-
pharmacy and digi-doctor services.
The biggest health emergencies of our times have not just laid bare the myriad
challenges and gaps in our health system but also highlighted the importance of
investing in ‘well-being’ at both personal and system level. It has ushered in an era of
digital and technological innovations and advancements that is expected to help
communities fulfil those requirements at a much faster pace.

IMPACT ON INSURANCE SECTOR POST COROVARIUS ERA:

All health insurance policies cover hospitalisation expenses. COVID-19 would not fall
within the definition of a pre-existing disease. Hence, all insurers would respond to the
hospitalisation claims normally. The Government is quarantining people suspected of
being infected and treating them once they test positive for COVID-19. Personal and
family floater health insurance covers less than 10% of the total number of people
covered under private and government-sponsored health insurance schemes.
Overseas travel policies could see some claims from travellers. This segment forms a
very small part of the overall health insurance portfolio. As stated earlier, the impact on
insurers would be marginal or less than normal. theatres, cancellation of sporting events
and even denial of visa to visit a country for business purposes cannot be cited as
reasons for loss of income to claim coverage. Many MSMEs/SMEs are either
underinsured or uninsured. Loss of income, business interruption coverage or natural
peril extensions are not opted for by these firms. There would be a significant impact
on revenue/income and profits of corporates due to loss of business. Without physical
or material damage, there would be no claims in their ALOP policies.

Property insurance policies provide coverage against fire, loss of profits following fire,
interruptions in engineering operations, business interruption, ALOP, contingent
business interruptions, etc. Such policies cover physical damage to the property insured
and business interruptions caused due to such events. Business interruption coverage is
often a part of a commercial property insurance policy. Therefore, physical damage to
the insured property is typically required to claim coverage. Business interruption by
itself is not enough to claim coverage. Unless there is a valid claim under the property
damage section of the policy, claims under the business interruption section would not
be considered. Even for ALOP or contingent business interruption, there is a
requirement of insured peril impacting the suppliers of material for projects. Projects
would face delays and cost overruns due to a shutdown. Coverage for losses caused by
forced closure of property by authorities typically requires physical damage to property
to trigger the business interruption coverage. Shutdown of malls and

The COVID-19 pandemic has affected the life and non-life insurance business during
FY20-21 and FY21-22. However, health insurance policies have shown a massive jump
during the same period, says a research report.

In the report, State Bank of India (SBI) says, "The pandemic has made people aware
not only about the indispensability of health insurance policy but also about the need to
have adequate coverage, better features and seamless services. The realisation has led
more people to buy new policies or port to insurers who offer better coverage and claim
settlement."

In FY20-21, retail health insurance policies have shown a massive jump of 28.5% to
Rs26,301 crore and continued to grow in FY21-22. From April 2021 to January 2022,
the health insurance portfolio of insurers increased by 25.9%, with a rise in retail health
policies of 17.28% and group policies of 30.1%.

"Insurance has been rapidly evolving as per the changing needs, and today's generation
is looking for products which are customised and made for them. So, there is a need to
innovate the products to bring more people under insurance coverage," says Dr Soumya
Kanti Ghosh, group chief economic adviser of SBI.

According to the report, the Indian insurance sector has shown resilience in the COVID-
19 pandemic, with the dip in premiums milder and the recovery being faster. In
particular, life insurance was affected during FY20-21 and FY21-22 due to the COVID-
19 pandemic, which has restricted the movement due to lock-downs, as insurance
business is mostly based on the agents' performance.

After muted showing in December 2021 and January 2022 because of the third wave
of the COVID-19 pandemic, life insurance companies reported impressive growth in
new business premium (NBP) in February, driven mainly by initial public offering
(IPO)-bound Life Insurance Corp (LIC) of India's sharp jump in NBP in the same
period, fuelled by 40% growth in group single premiums. NBP of life insurers rose
22.47% year-on-year (y-o-y) to Rs27,464.76 crore in February, with LIC's NBP
recording a jump of 35.4% to Rs17,849.34 crore and private insurers reporting a growth
of 5% to Rs9975 crore.
The premium of non-life insurers slipped after rising for two straight months as sales
fell across categories, with the crop protection business faring the worst. The industry's
revenue or gross premium underwritten declined 22.6% over the previous month to
Rs16,561 crore in February 2022. At the same time, y-o-y growth registered 5% and
20% above the corresponding pre-pandemic period in 2020.

According to the SBI report, in FY20-21, the death claims paid by the life insurance
industry increased by 40.8% to Rs41,958 crore. In the case of individual life insurance
business, during 2020-21, the life insurers paid 10.84 lakh claims, with a total benefit
amount of Rs26,422 crore, a growth of 46.4%. The ticket size of the death claims has
increased to Rs2.44 lakh in FY20-21, compared to Rs2.13 lakh in FY19-20. The rise in
death claims seems due to the increased deaths by COVID-19, it says.

"Despite digitalisation, the share of policies sold through online and web aggregators
stands at 1.9% in terms of premium value and around 1.6% in terms of the number of
policies. The growing channel is 'bancassurance', in which the share in premium
collections has increased to 29% in FY20-21 from 16.6% in FY13-14. However, in case
of private insurers the share of bancassurance is around 55%, while LIC depends mostly
on 'individual agents'. The individual agents’ share has been declining and is at 58% in
overall industry level in terms of life insurers, about 23% for private insurers and 94%
for LIC," SBI says.

The services sector witnessed recovery from the impact of the nationwide lockdown
imposed during March-May 2020 and localised lockdowns during the second COVID
wave in April-May 2021.During the first half of 2021-22, the services sector grew by
10.8 percent. The Gross Value Added (GVA) of services crossed the pre-pandemic
level in the second quarter of 2021-22.

As per the first advance estimates, GVA of the services sector is estimated to grow by
8.2 percent in 2021-22, said the Economic Survey that was presented by Finance
Minister Nirmala Sitharaman on January 31, detailing the state of the economy ahead
of the government's Budget for the fiscal year beginning April 1, 2022.Although the
spread of the Omicron variant brings in a degree of uncertainty for the near term,
especially in segments that require human contact.

The subsector trade, hotels, transport, communication, and services related to

broadcasting, which was the worst hit last year, grew by 18.4 percent year-on-year
(YoY) in H1 2021-22. However, the quarterly GVA of this sub-sector is still below its
pre-pandemic level.

The Economic Survey noted that at the time of writing the survey, new restrictions
were being introduced within the country and worldwide due to the Omicron variant,
posing a fresh risk to the ongoing recovery, especially in contact intensive
segments.The services sector that had contracted by 8.4 percent YoY in 2020-21, the
decline was driven by a sharp contraction of 18.2 percent YoY in the sub-sector trade,
hotels, transport, communication, and services related to broadcasting. Owing to its
contact-intensive nature, the services included in this sub-sector had to bear the
maximum brunt of the disruptions caused by the prevailing pandemic.

While non-contact services such as information, communication, financial,

professional, and business services have remained resilient, the impact has been much
more severe on contact-based services such as tourism, retail trade, hotel,
entertainment, and recreation, the Economic Survey said.The sub-sector public
administration, defence, and other services which include expenditure by the
government on one hand and services such as health, education, recreation, on the
other, contracted by 4.6 percent YoY in 2020-21. The relatively less contact intensive
sub-sector financial, real estate, and professional services were the least impacted,
with a marginal decline of 1.5 percent YoY in its GVA during 2020-21

Sub-sectors trade, hotels, transport, communication and broadcasting services,

financial, real estate and professional services, and public administration, defence, and
other services are estimated to expand by 11.9 percent, 4 percent, and 10.7 percent
respectively in 2021-22.The services sector contributes over 50 percent to India’s
gross domestic product (GDP). While the Covid-19 pandemic has had an adverse
impact on most sectors of the economy, the services sector has been the worst
affected as its’ share in India’s GVA declined from 55 percent in 2019-20 to 53
percent in 2021-22.

IMPACT ON THE EXPORTS AND IMPORTS INDUSTRY OF INDIA:

Exports:

Exports from India have been growing over the years. From 0.6% in 1991, India’s
share in world exports went up to 1.7% in 2018. In 2019, Indian businesses shipped
goods worth US$ 322.8 bn around the globe. Countries such as the USA, UAE, China,
Hong Kong, Singapore, UK, Netherlands, and Germany featured among the top
importers from India.

The top export goods ranged from mineral fuels, gems and precious metals,
machinery, organic chemicals, vehicles, pharmaceuticals, electric machinery to
clothing, accessories, knit or crochet clothing. India has also been emerging as a
leading exporter of information technology and related offerings. Export value of IT
software and services from India grew from US$ 44.8 bn in FY2009 to US$ 136 bn
in FY 2019.

With the COVID-19 pandemic spreading across several countries, the global
economy has been deeply impacted, and India is no exception. Predictably, the
pandemic has impacted Indian exports too. India’s exports saw a record month-on-
month drop of 60.28 per cent in April 2020. With the exception of iron ore and
pharmaceuticals, most sectors saw a decline.Pharma was one sector that saw
considerable growth as India played an important role as the ‘pharmacy of the world’
in the fight against the COVID-19 pandemic. Indian pharma manufacturers helped
meet the demand for drugs such as paracetamol and hydroxychloroquine, in addition
to other life-saving drugs. As per the Pharmaceutical Export Promotion Council and
the Ministry of Commerce, drug and pharma exports rose to US$ 2.04 bn in May, as
compared to US$ 1.6 bn in the same month last year.

Petroleum
Petroleum products were the most affected commodities in terms of exports from
India, with a decline of about 32 percent in January 2021, compared to the same
month in the previous year. Other cereals and oil meals witnessed a highly positive
change rate.

BOOSTING EXPORTS POST-COVID

Exports are an important growth driver for India, despite the country having a huge
domestic market. Therefore, there need to be adequate measures in place to further
boost exports post the pandemic. Over the years, the Indian government has taken
several steps that have helped bolster growth in exports. For instance, they simplified
the extant policy on FDI to enable greater ease of doing business to attract more FDI.
It also ratified the WTO’s Trade Facilitation Agreement. Such steps have proved to
help to boost exports over the last few years.

Still, there is a lot of work to be done, especially when it comes to boosting India’s
export preparedness to help it leverage the demands of the post-COVID world. The
Export Preparedness Index (EPI) 2020 that examines the export ecosystem of Indian
states and union territories puts India’s average score at 39 out of 100. The study
reveals factors such as lack of export infrastructure, basic trade support, and access
to financial facilities and credit as some of the drawbacks impacting export
preparedness in several Indian states. Therefore, there is tremendous scope to act on
these issues and boost India’s growth. There has already been some progress in this
direction. Recently, Finance Minister Nirmala Sitharaman announced certain
measures to boost the export potential of MSMEs that contribute 50% to Indian
exports. She revised the existing MSME definition such that manufacturing and
service MSMEs are defined under a common metric. This will enable both
manufacturing and service MSMEs to enjoy similar benefits and empower them to
drive even greater exports.

EMBRACING INNOVATION

One of the heartening side effects of the pandemic and the subsequent lockdown has
been that it has brought the tremendous potential of digital technologies to the fore.
Information technology played an important role in allowing for information
exchange and enabling remote working wherever possible during the lockdown. The
pandemic has accelerated the pace of digitisation across industries and created a
disruption in business models. It has also forced businesses to explore new ways of
doing business given the constraints of the lockdown and social distancing
requirements. Businesses will continue to accrue the many benefits of these
innovations even when the COVID-19 pandemic runs its course.

As the world becomes increasingly globalised, the demand for quality products and
innovative solutions is only set to grow. A growing focus on R&D will help move
further up the value chain and deliver more premium, cutting-edge products and
services that can improve the quality of life in India and the entire world. Exports can
prove to be the bedrock that boosts India’s emergence as an economic superpower.
With the right investments in regional infrastructure and a supportive policy
environment, Indian exports are set to increase steadily in the post-COVID world.

IMPACT ON INDIAN IMPORTS INDUSTRY POST CORONAVIRUS ERA:

Covid 19 pandemic has taken the whole world under the threat of death. It has kept
human life in danger as no vaccine and medicine were invented for a long period. To
stop this chain of spread of corona virus the management has accepted the SOP of the
World Health Organization (WHO) to create social and physical distancing within their
areas. The infected persons were kept in isolation from the rest of the public for a
specified period of 14 days, to break the chain of infection in public. Entire world has
accepted lockdown as a model of social distancing. General public had to stay at home
during this period of lockdown. Except for essential services like health, supply of food,
vegetables, medicines, milk all other services and activities were kept closed. The
supplies of essential services were allowed through authorized persons or pass holders
in curfew bound areas. All the institutions such as schools, colleges, shop,
marketplaces, mall factories construction sites were closed. Authorities have issued
advisories to be followed even in social functions like marriage or death. Border of the
nations was closed for citizens of other countries. Even state borders were sealed to
stop the spread of virus. Normal economic activity was disrupted due to covid-19
pandemic. Indian economy was severely affected; trade and business were at risk to the
unfolding economic crisis. Sudden loss of income of middle class people was the reason
of dropdown in demand of goods and services.

Impact on Retailers The tenth edition of the Retail Business Survey showed a consistent
month-on-month regaining in retail organizations across India drove by festive
shopping, with November 2020 deals being only 13% shy of the deals during the
relating time frame last year. In November 2020, the customer durables and hardware
class kept on recuperating, logging deals at 12% year-on-year, the apex body's overview
added. For the time being, the food and grocery market has begun to exhibit deals
development at 5% year-on-year, while textile and garment is as yet reeling under
tension with around less (-) 12% year-on- year behind pre-pandemic deals. The period
of November was set apart by Diwali festivals and furthermore lined up with the
wedding season. Impact Channel The current situation of pandemic has badly affected
Indian economy, but there are some sectors that determine the aspect of trade and
commerce in country. Hard -hit sector of the economy can be analysed as under India
has as of late seen a defeat of about 3% in business rates. Likewise not many of the
areas are working distantly that has affected the working of different ventures in this
way influencing the interest and supply of goods in such industries. These industries
play an important role in trade and business and their closure now has badly hit the
Indian economy. The impacts of COVID-19 in the travel industry, hotel and amusement
areas have been uncommon. In the lodging and accommodation areas, quarterly
incomes are down 75%. Holiday planners and travel agent saw a log jam in
appointments of half in March of 2020. Aircrafts overall are relied upon to lose $113
billion in incomes for 2020. In the pinnacle of the episode, every one of the booked
trips in India has been dropped. As of mid-March 2020, worldwide travel has come to
a standstill, with the World Travel and Tourism Council (WTTC) assessing that
worldwide travel would decrease at any rate 25% in 2020. Sharp drop in international
tourism creates problems for service areas like hotels, airlines, tourism, food, restaurant,
and all these sectors felt large drop down in their turnover in lockdown situation.
Decrease in booking as well as advisories of government to refund of the booking in
airlines and railways was the hard time that faced and fear of corona virus has almost
closed the door for turnaround of these industries. And all this has impacted the Indian
economy, which now needs some sharp minds to work on it to figure out the makeup
policies in the coming time. US and EU were the biggest export market for the Indian
companies but the ongoing pandemic leading to the lockdown had strong effect on the
foreign trade. Stats clearly show that even before this lockdown period, Indian trade the
import and the export has already witnessed some downfall due to number of reasons.
India’s merchandise exports declined by 1.5%between April 2019-February 2020while
imports declined by 7.3% to $436.03 billion. The destruction occurred due to this
pandemic situation may increase more and it will take time to recover the loss. Not only
internationally but domestically as well the trade and commerce to be blocked at this
moment Target market demand is assumed to drop by 15%. This would affect in a
redistribution of family demand across sectors, while total expenditures are still driven
by previous shocks and relative prices of goods in the consumption basket. After
analysing the basic problems that has arisen in the present situation due to the
widespread pandemic, it would be difficult to say as to how much are these sectors
going to suffer more. To take some steps to minimize the impact of COVID-19 on the
trade and business would be the priority of government. Moreover, for a country like
India it becomes important to trace all possible solutions to keep a hold over the
situation.

MEASURES

• Government has already declared a package to boost up the economy however

condition we are facing has already impacted a lot and we need to adopt some
more measures to it.
• It is known that IBC remains suspended for the time being; also the RBI has
provided certain relaxation which is good effort considering the situation but
this will not be enough for a long run and we need to think about another strong
alternative.
• A global problem requires a global solution and there is a need for collaboration
of countries not just on health, but also on trade, finance and macroeconomic
policies.
• Trade and commerce is required to be enlisted as essential services as they are
the backbone in determining the economy of a nation. Prof. Grishma Gaurang
Thakker: Post Covid Effect on Trade and Commerce in India 105
• As India has responded to the demand of medicines by US and Brazil, so it
reflects that trade and commerce is possible even during the current situation
with minimal risk to life. Also, this step to US and Brazil has established the
trustworthiness of the Indian Pharmacy industry and the government should
look to work in this direction and become a major exporter of such medicines
to other countries as well. This may will help the economy.
• WTO needs to come forward to strengthen the trade and commerce at the global
platform.
IMPACT ON INDIAN UNEMPLOYMENT POST CORONAVIRUS ERA:

The Centre for Monitoring Indian Economy (CMIE) recently released the
unemployment status report of India for December 2021. According to the report, the
unemployment rate in the country was 7.91% in December. It was 7% in November. The
highest unemployment rates were reported in Haryana (34.1%), Rajasthan (24.1),
Jharkhand (17.3%), Bihar (16%), and Jammu and Kashmir (15%).

On the other hand, states such as Karnataka (1.4%), Gujarat and Odisha (1.6%),
Chhattisgarh (2.1%) reported the lowest unemployment rates in India. High
unemployment rates can be attributed to a combination of delayed economic recovery, a
surplus of labour, and a slow agricultural season.

The COVID-19 pandemic has had a detrimental effect on the labour market worldwide,
causing many individuals to lose their jobs and businesses to close. The CMIE also
reported that the unemployment rate for the urban areas increased from 8.21% to 9.3%,
and from 6.44% to 7.28% for the rural areas.

Imposed restrictions could explain these statistics because of the rising Omicron cases
since December 2021. Many services such as schools, gyms, and movie theatres were
forced to shut down in various states temporarily. This had a significant impact on
economic activity and contributed to a rise in the unemployment rate.

However, the COVID-19 pandemic can be only partly blamed. Since the unemployment
rate is one of the key indicators used to assess the health of a country’s economy, the
report also indicated that India’s current economic situation could not provide enough
jobs for job seekers.

While a single unemployed person has minimal influence on society, high

unemployment rates in some states may sometimes contribute to increased poverty rates
and poorer neighbourhoods, exacerbating the socioeconomic impact of unemployment.
These regions with high unemployment rates are more likely to have restricted career
opportunities, inadequate housing, fewer recreational activities accessible, as well as
limited access to public services and underfunded schools.
With more people being unemployed, more individuals earn less income. Thus, they will
spend less money, resulting in decreased economic contribution in terms of services and
products supplied and produced. In other words, unemployed individuals have reduced
purchasing power, leading to additional employment losses for goods’ suppliers.
Consequently, a higher unemployment rate might lead to a scarcity of goods and
services offered in India.

Research has found that a rise in unemployment also leads to increased suicide rates in
all parts of the world. Young people with more significant financial obligations, those
with the highest education, or a higher feeling of self-efficacy established by earlier
accomplishment in various circumstances, including school and job, are more likely to
have lower mental health. They are likely to be more sensitive to the damaging mental
effects of unemployment.

While there is not much extensive research done on the effects of unemployment on
physical health, there is some evidence of a link between high blood pressure and young
unemployed individuals. A five-year prospective study of school leavers found that
those who were jobless for a more extended period had a considerably more significant
rise in systolic blood pressure compared to young males with short-term jobs or no jobs
during the research period. However, these differences did not exist in females.

Furthermore, a longitudinal study of Irish youth found that unemployed males had lower
mean body fat than those employed. The same results were not found for unemployed
females. This could be explained to have occurred due to poverty and malnourishment
due to being jobless. The same study also found that unemployed young women had
considerably worse respiratory function than those employed. The possible reason
behind this is that jobless women are prone to smoking due to unemployment,
contributing to their lower lung function. Additionally, an extensive study has found that
youth unemployment is associated with increased smoking and alcohol intake.

Since unemployment may negatively influence a person’s physical and mental health,
the Indian government may be forced to spend enormous resources on job creation and
healthcare.
CHALLENGES FACED BY INDAI POST CORONAVIRUS ERA:

The Reserve Bank of India (RBI) surprised markets by holding its key repo rate
steady on Thursday after six consecutive hikes, saying it was closely monitoring the
impact of recent global financial turbulence on the economy. The central bank said its
policy stance remains focused on "withdrawal of accommodation", signalling it could
consider further rate hikes if necessary, but a number of economists now expect the
central bank to remain on hold.

Retail inflation rose 6.44% year-on-year in February, easing from 6.52% in January
but has remained above the central bank's mandated target range for 10 out of the last
12 readings. The central bank sees inflation at 5.2% in 2023-24, and GDP growth is
seen at 6.5% in the financial year beginning April 1.

"With unyielding core inflation, we remain firm and resolute in our pursuit of price
stability which is the best guarantee for sustainable growth," said the committee in its
statement. "The impact of our actions over the past 12 months is still playing out and
would increasingly weigh on the future inflation trajectory."

It is necessary to assess the cumulative impact of actions taken so far, said Das. Early
signs of a slowdown have been visible in bank credit growth which has slowed to
15.7% on-year as of March 10, easing from a decade high of 17.9% touched in
October.

Financial stability concerns appear to have prompted the pause in rate hikes, said
Aditi Nayar, chief economist at rating agency ICRA, adding that another hike was
possible if inflation does not fall. The decision to hold interest rates steady was
unanimous in contrast to the last decision when four members had voted for a hike in
rates.

Five of the six committee voted in favour of continuing with the stance of
"withdrawal of accommodation", while one member dissented. "Retaining the stance
at removal-of-accommodation also signals a continued focus on steadily guiding
inflation down towards the 4% target," said Saugata Bhattacharya, chief economist at
Axis Bank.

The hiking cycle could resume if the data warrants it, said Shilan Shah, deputy chief
emerging markets economist at Capital Economics. "But given the subdued growth
outlook and the likelihood that inflation falls back to within the RBI’s target range
before long, our view is that the tightening cycle is at an end." Inflation is crucial to
determine one’s purchasing power. In other words, inflation is a measure that causes
the prices of both goods and services to rise over time and buyers will feel the pinch
as it affects their personal finance, particularly spending and buying habits.

One way of understanding inflation is, for instance, you bought a list of household
essentials last month at an expense of INR 1,000, but this month the price of a certain
food item in the same list has risen and that has led to an increase in the cost by let’s
say INR 1,100. You may be either forced to remove an item from your cart or buy the
product that has the inflated price by paying extra which may affect your monthly-
set budget.

Therefore, any factor that causes prices of goods and services to rise in the market and
create instability in consumption leads to inflation. Economists suggest that achieving
inflation that’s moderate enough to drive consumption will create a baseline of growth
in the economy. However, high inflation indicates that an economy is facing serious
troubles; whereas, low inflation, a.k.a. deflation is equally worrisome.

How to Calculate Inflation Rate In India?

There are two indices that are used to measure inflation in India — the consumer
price index (CPI) and the wholesale price index (WPI). These two measure inflation
on a monthly basis taking into account different approaches to calculate the change in
prices of goods and services. The study helps the government and the Reserve Bank
of India (RBI) to understand the price change in the market and thus keep a tab on
inflation.

The CPI, which refers to the Consumer Price Index, analyzes the retail inflation of
goods and services in the economy across 260 commodities. The CPI-based retail
inflation considers the change in prices at which the consumers buy goods. The data is
collected separately by the Ministry of Statistics and Program Implementation and the
Ministry of Labour.

The WPI, which refers to the Wholesale Price Index, analyzes the inflation of only
goods across 697 commodities. The WPI-based wholesale inflation considers the
change in prices at which consumers buy goods at a wholesale price or in bulk from
factory, mandis, etc.

The Indian economy is one of the fastest-growing economies in the world. However,
it faces a number of challenges that need to be addressed in order for it to continue to
grow. One of the biggest challenges is population density. India has one of the highest
population densities in the world, which puts a lot of pressure on resources like land
and water. Another challenge is Indian infrastructure. The country’s infrastructure is
not up to par with other developed countries, which hurts economic growth.
Additionally, India has a large poverty problem, which needs to be addressed if the
country wants to see continued economic growth.

Indian Economy
The Indian economy is the world’s tenth-largest economy by minor GDP and third-
largest by PPP (purchasing power parity). India is a member of the G20, the
International Monetary Fund (IMF) and the World Bank. The Indian economy is
projected to be the world’s second-largest by 2050.

Challenges Includes:
There are different challenges that the Indian economy faces. Here are they:
Population Density
The population density of India is one of the highest in the world. This population
density, coupled with Indian infrastructure which is not able to keep up with the
population growth, is one of the main problems that the Indian economy faces.

Poverty Problems
Another challenge faced by the Indian economy is poverty. Nearly 22% of the
population lives below the poverty line. This means that a large portion of the
population is not able to participate in the economy and this leads to a vicious cycle of
poverty.

Unemployment
Unemployment is another big challenge that the Indian economy faces. The
unemployment rate in India is at a 45-year high. This means that there are a lot of
people who are not able to find jobs. This leads to a lot of social problems as well.

Payment Deterioration
One of the most recent challenges faced by the Indian economy is payment
deterioration. This is caused by the delay in payments from the government to
contractors and suppliers. This has led to a lot of financial problems for the
contractors and suppliers.

Poor Education
Another challenge that the Indian economy faces is poor education. The literacy rate
in India is only around 74%. This means that a lot of people are not able to get good
jobs and participate in the economy. This leads to a lot of social problems as well.

Private Debt
Another challenge faced by the Indian economy is private debt. The private debt to
GDP ratio in India is one of the highest in the world. This means that a lot of people
have taken out loans and are not able to repay them. This leads to a lot of financial
problems for the economy.

Fixed Labour Laws

Another challenge faced by the Indian economy is fixed labour laws. These laws
make it very difficult for companies to lay off workers. This leads to a lot of
inefficiency in the economy and leads to a lot of financial problems for the
companies.

Inadequate Infrastructure
One of the biggest challenges faced by the Indian economy is inadequate
infrastructure. The infrastructure in India is not able to keep up with the population
growth. This leads to a lot of problems such as traffic jams, power cuts, and water
shortages.

Corruption
Corruption is another big challenge faced by the Indian economy. Corruption leads to
a lot of inefficiency and waste in the economy. It also leads to a lot of social problems
as well.

These are some of the challenges faced by the Indian economy. Population density,
poverty problems, unemployment, payment deterioration, poor education, and private
debt are some of the main challenges. These challenges need to be addressed in order
to make the Indian economy stronger.

Conclusion
The Indian economy is currently facing a number of challenges. These include high
levels of inflation, an unstable rupee, and a large current account deficit. In addition,
the country faces significant infrastructure needs and a growing population that is
increasingly young and educated. These factors present both opportunities and
challenges for the country’s economic growth in the years ahead. Students who are
interested in learning more about India’s economy should read this article for an
overview of the most important issues facing the country today.

LITERATURE REVIEW:

In India, the real GDP of the nation is believed to have been degraded from the past 6
years till the third quarter of the financial year 2019-2020. Also, the outbreak of the
COVID-19 pandemic has further added to the problems in the economy of India. The
outbreak of the COVID-19 pandemic has forced India to impose a country wide
lockdown which has resulted in shutting down almost all of the sectors of the nation
which has further escalated the economic and sustainable problem for India. According
to MoSPI, 2020, there are three major factors that are essential contributors to the GDP
of India. These three contributors are private consumption that takes place in the
country, investments made and the external trade made by India. Because of the
lockdown caused due to the COVID-19 pandemic, these factors are drastically affected
leading to disruption in the real GDP of India. Impact on the demand – The COVID-19
pandemic has resulted into a significant impact on the private consumption of India
which forms a sizeable part of the economy. According to MoSPI, 2020, the private
consumption expenditure from the restaurants and hotels has fallen down to 2.2 percent
in the total share of the economy which is believed to be a significant downfall. Also,
the sector of recreation and culture has also witnessed a significant drop in the total
share of the private consumption. The total share of the recreation and culture in
calculated to be 0.80 percent which is significantly lower than the levels it used to be
before the COVID-19 pandemic. Also, the COVID-19 pandemic has resulted in delays
in supply chain for many industries which has resulted in halt in the production process
for most of the industries. As a result, this stoppage in the production process has further
resulted into stoppage on the export of the products which are imported by different
nations of the world. This stoppage in the export has further degraded the economy of
India and has created financial crisis for the Indian Government and has led to severe
financial problems for the country

RESEARCH METHODOLOGY:

Meaning Of Research
The Indian economy shrank by 7.3% in the April–June quarter of this fiscal year,
according to official figures issued by the ministry of statistics and programme
implementation. Since the ministry began compiling quarterly GDP statistics in 1996,
this is the greatest decline that has ever been recorded. Following the implementation
of the lockdown, an estimated 10 million migrant labourers returned to their home
countries in 2020. The fact that neither the state administration nor the federal
government had any information about the migrant workers who lost their jobs and
their lives during the lockdown, however, was shocking. The government did more than
just create up a digitised, centralised database system for migrant workers who returned
to their home countries during the second wave of the boom. Existing weaknesses in
the Indian economy have been forcibly revealed and made worse by the second wave
of COVID-19. The $2.9 trillion Indian economy is still closed throughout the shutdown,
with the exception of a few necessary services and activities. The lockdown had a
severe effect on slowing down the economy as stores, restaurants, factories,
transportation services, and business premises were closed. The global pandemic has
disproportionately affected the unorganised sections of the economy. If the informal
sectors are taken into The two main drivers of India's economic growth are private
consumption and investments. Except for agriculture, all of the major economic sectors
were severely impacted. Before the second wave even arrived, the Indian economy was
in trouble. The COVID-19 has highlighted and exacerbated already-existing disparities
in the Indian economy, especially when combined with the humanitarian catastrophe
and the government's silence. A recession is unavoidable as the economy will continue
to decline during the ensuing four quarters. Everyone is in agreement that the Indian
economy would shrink for the entire year. According to studies by the Centre for
Monitoring Indian Economy, unemployment will increase significantly during the
April–June 2021 quarter, with rates ranging from 7.9% to 12%. account, the GDP
reduction in India from April to June may have exceeded 8%.

Objectives Of Research:

● To study all sectors which faced post coronavirus impact.

● To analyse all the challenges face by the Indian Economy.
● To study all the sectors who faced the economic impact post covid- era.
● To understand the people’s challenges they faced on their
professional/economic impact.
● To understand the current market trends and consumer preference over things.
● To understand the current career and job trends in India.

Scope Of Research:

● Fun and Informative : A study on the economic impact on the Indian economy
to understand what was the situation then and what is the situation now and to
know what all is needed to improve the conditions to the better stage.
● Enthusiasm: For the vast majority of individuals who wish to look for a vocation
in economics, they have an enthusiasm for the economic business. This mixed
industry impact also attracts those enthusiastic individuals who have a keen urge
to understand the economic impact.
 ● Find the Economic Findings: This study offers a great deal of chances of
voyaging through various jobs and careers which impacts the economy’s
growth.
● Meeting New Individuals: In the realm of this type of work, workers experience
everyday as a different one. In this job, workers meet new clients who have
different preferences about their jobs.
● Understanding New Trends: workers are able to understand new trends
regarding market place, their jobs, and current job requirements which will help
them to find a better opportunity.

Research Design:

The research design followed for the topic includes data analysis, description of
uncontrolled factors affecting economic impact on India post coronavirus, studies cross
sectional study about trendlines and what all was previously. The research design also
refers to the overall strategy that you choose to integrate the different components of
the study in a coherent and logical way, thereby, ensuring you will effectively address
the research problem; it constitutes the blueprint for the collection, measurement, and
analysis of data. It’s a collection of data that includes critical information by taking
research methodologies into consideration. In other words, it is a compilation of
information or data explored by setting a hypothesis and consequently coming up with
substantive findings in an organised way. Research can be done on an academic as well
as on a scientific basis as well.

Data Collection:

Data collection is the procedure of collecting, measuring and analyzing accurate

insights for research using standard validated techniques. A researcher can evaluate
their hypothesis on the basis of collected data. In most cases, data collection is the
primary and most important step for research, irrespective of the field of research. The
approach of data collection is different for different fields of study, depending on the
required information.
Primary Data: Primary data is a type of data that is collected by researchers directly
from main sources through interviews, surveys, experiments, etc. Primary data are
usually collected from the source—where the data originally originates from and are
regarded as the best kind of data in research.

The sources of primary data are usually chosen and tailored specifically to meet the
demands or requirements of particular research. Also, before choosing a data collection
source, things like the aim of the research and target population need to be identified.
The Primary Data used in my project includes a questionnaire of Economic
Impact on India Post Coronavirus Era.

Secondary Data: Secondary data is the data that has already been collected through
primary sources and made readily available for researchers to use for their own
research. It is a type of data that has already been collected in the past.

A researcher may have collected the data for a particular project, then made it available
to be used by another researcher. The data may also have been collected for general use
with no specific research purpose like in the case of the national census. The Secondary
Data used in my project includes Annual reports of ministry of finance, health and
family, urban affairs and development, foreign trade, commerce and trade, and
written research papers of different researchers.

FINDINGS AND OBSERVATIONS:

This research helped me realise that people with affluent backgrounds, good earnings
and jobs related this sector or other sectors are interested in their dream brands and love
to pursue their dream purchases and the following chart represents the same.
The following graph shows that during the coronavirus period unemployment was most
during the months of March & April , which was due to epidemic time, this led to a lot
of finanicial unstability among most of the citizens. The pandemic resulted in a sharp
increase in unemployment, especially among young workers in urban areas who were
at the frontlines of the pandemic (NSO, 2020). While GDP recovered in 2021,
unemployment has remained above its pre-pandemic levels, especially among young
workers.
• Social Factors: In India the caste system is prevalent.
• Rapid Growth of Population: Constant increase in population has been
a big problem in India
• Dominance of Agriculture
• Fall of Cottage and Small industries
• Immobility of Labour: ...
• Defects in Education System:
Monetary factors such as an increase in the money supply, low-interest rates, or a
devaluation of the currency can also cause inflation in India. These factors can increase
the demand for goods and services and decrease the purchasing power of consumers.

Inflation can significantly impact the purchasing power of consumers, leading to a

decrease in their standard of living. As the prices of goods and services increase,
consumers have to spend more money to maintain their current lifestyle, leading to a
decrease in their disposable income.

Inflation can have a significant impact on the overall economy of India. It can lead to
an increase in the cost of living, decrease in investment, and instability in financial
markets. It can also negatively impact international trade and relations.

In India, the inflation rate is measured using the Consumer Price Index (CPI) which
tracks the change in the price of a basket of goods and services consumed by
households. The inflation rate is calculated as the percentage change in the CPI over a
specific period of time.

In recent years, there has been an increase in inflation in India, with the rate hovering
around 5-6%. This has been attributed to several factors, including rising food and fuel
prices, supply chain disruptions caused by the COVID-19 pandemic, and increased
government spending.
People suggested that they did find the change in their status – whether it was getting a
new job or stated as unemployed for some time. This was because the companies
weren’t earning enough revenue and thus there wasn’t any profits which made them go
in loss, hence the employees were are to leave as the companies didn’t require alarge
no. of staff with less work.
Some stated that yes there were changes in the price of the essential goods , others
stated no because they were purchasing items at the same price before and hence didn’t
find any change . This stated that the increase in price of essential good and items made
people increase their monthly budget which made them increase their expenses.

Some of them stated a yes and some stated a no because some of them became
unemployed and others decided to invade new opportunities virtually more than
physically. This was because the some people who were unemployed either started a
side business or started working for a side income to generate more income to make
important further expenses.

Q3)

Some stated yes because even though most of them experiences a gradual or drastic
reduction in income , some who worked hard apart from their side income were able to
retrieve their expenses out of their income and could start to save again. This was again
due to people working for side income apart from their own income, while those who
became unemployed were only able to work with their savings
Most of them stated yes as students or citizen who wanted the loans were not able to
get the loans or credits due the financial unstability of the country. The country wasn’t
being able to function in a better manner, the price of all essential goods rose, inflation
increased and people could save for their future.

Most of them stated a positive reply bvecause during the pandemic period the people
were beign given less wages or became unemployed which resulted in a massive
decrease in the wages of the workers. They also became rigid and were not able to
survive as during this period dercrease in wages resulted in increase in expenses which
resulted in inflation .

It was an equal decision as most of the people were not able to get new jobs some
became unemployed others were still having their old jobs and were able to use their
income from all jobs to live their life and minimise their expenses.

People stated that they were more likely to save money post coronavirus as compared
to free coronavirus because people were not able to complete their expenses and they
were not able to get more money from the side income or from their income hence they
decided to save more money whichever they were able to gather than spending on other
luxurious items or other items apart from their essential goods it was because the
inflation was high the amount they got as wages were low and some even went in as
unemployed.

All of them stated that yes they did cut their expenses on luxury item as they understood
that after coronavirus is born they were still able to get expenses on their luxury items
or other in other words they could spend money on their luxury items but right now
during the coronavirus and during the time of this pandemic they could not spend
because they had to get the essential goods instead of luxury coach this month that they
had taken over essential goods instead and they decided to do so because they had low
wages or low salary and wanted to be able to help the household rather than their own
personal choices.
Most of them said guess the post corona era made them to start a site income but some
said no because some were still working with their old incomes in were able to
overcome their expenses and started to save mode but those who had decided income
apart from their income saved in more than the other people and this was because
having 2 incomes or having 3 incomes beside your own income was the only choice
they could make to help the help their own households overcome the expenses and be
able to save much more money than the other people.
Some stated yes that they carry a grow alongside their job but mostly said no because
they were not able to to grow their career as they had left their jobs or they were
actually made unemployed and this was because I all love this pandemic which made
them leave their job or which made the companies make them resign as the companies
had less work and more workers it could not match and therefore giving salary to
them was already a loss over loss for the company hence they were made unemployed
and once the employees were unemployed they could not see their career grow
alongside their job but mostly said yes as they started to study more or find new
horses alongside their job to increase their job skill sets

CONCLUSION:
Over the last few years that is from the covid pandemic era all of the people who had
given the survey the stated that during the covid pandemic they had suffered a lot of
losses both mentally physically and emotionally they were not able to get better
wages they were not able to grow their own career they had their old jobs which they
lost most people started aside income but during the covert when they were nobody
decided to support them by buying their staff so their side income just reduced apart
from that all of those who stated that yes their old income was perfect They were not
able to still be able to overcome their expenses.

Many also stated that after losing their lives After losing their loved ones they
understand they also understood that all those employees who are working with
companies We are not able to survive in a better manner That their expenses have
increased and their salary has decreased and this has led them to not be able to live a
better life.
They were able to understand Neither their personal loss nor their intellectual laws
was able to help them get through all of this Which actually shook their entire country
both financially and economically which also led them to not be able to come out of
their shell They also understood that the only way to come out of this was to be To cut
down their own luxurious expenses and increase their savings by starting a styling
come this was the only way they could be able to come at us Come out of their
problems others who are being able to use their only income they decided that they
should increase their other income by starting a side income and also increase their
career by studying new courses to increase their skill set and also being able to
increase their income by adding all of these incomes.

Micro, Small and Medium enterprises, which have created more than 90 per cent of
the jobs in India, employing over 114 million people and contributing 30 per cent of
the GDP are at the risk of having a severe cash crunch if the lockdown is extended to
8 weeks. Many of these MSMEs have loan obligations and monthly EMIs to pay.
Many of them might just disappear if their cash cycle is disturbed because of the
lockdown, with fixed costs dangling over them in such a situation. They need a
moratorium for loan repayments. RBI has released funds to non-banking financial
corporations, some of whom provide finance to MSMEs. In addition to that,
movement of perishable goods is hampered and thus, these businesses stare at huge
losses. India cannot have a real and sustainable growth without having a thriving
MSME sector. The COVID-19 crisis will also test the resilience of start-ups in India.
Start-ups have to rely on cross-border fund raising. Several founders are seeing their
businesses grinding to a halt. Receivables are spiralling and they have to undertake
painful cost-reduction measures in their ventures. Government will have to make
funds available to this sector, as venture capital firms may take a little longer to come
and support because of the restricted global capital flows.

While the unprecedented situation has caused a great damage to the economy,
especially during periods of lockdown, the nation will have to work its way through it,
by introduction of fiscal measures. As the national government envisions, protection
of both lives and livelihood is required. The economic activity must begin gradually
after screening of the labour force. Strict preventive measures should be implemented
by the industry in order to safeguard the health of the workers. While policy and
reforms should be doled out by the government adequately to salvage the economy,
the industry, civil societies and communities have an equal role in maintaining the
equilibrium. The norms of social distancing, avoiding or cancelling gatherings, and
use of masks and sanitisers should be the way of life till we are able to eradicate the
virus. During this time, the economy is juxtaposed with social behaviour of
humankind, so the responsibility of bringing back economic action is not of
government alone.
The risk of a global recession due to COVID-19 in 2020 and 2021 would be
extremely high, as it has been observed globally that the shutdown of all economic
activities—production, consumption and trade—to control the spread of COVID-19 is
imminent. The nature of shutdown is unique in case of COVID-19 due to a supply
shock, a demand shock and a market shock. The recovery in economy depends on the
timings and magnitude of government support as well as the level of corporate debt
and how the companies and markets cope with lower demand. Government assistance
to those most in need (largely constituted of unorganised sector, migrants and
marginalised communities) is a critical measure to save many lives.
However, every crisis brings about a unique opportunity to rethink on the path
undertaken for the development of a human being, community and society. The
COVID-19 pandemic has a clear message for the Indian economy to adopt sustainable
developmental models, which are based on self-reliance, inclusive frameworks and
are environment friendly.
The spiralling and pervasive COVID-19 pandemic has distorted the world’s thriving
economy in unpredictable and ambiguous terms. But it significantly indicated that the
current downturn seems primarily different from recessions of the past which had
jolted the country’s economic order. Whereas the nations, conglomerates,
corporations and multinationals continue to understand the magnitude of the
pandemic, it is undoubtedly the need of the hour to prepare for a future that is
sustainable, structurally more viable for living and working.
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1) Radhika Pandey A. P. (2020). Covid-19 and MSMEs: The ‘identification’ problem.

Ideas for India for More Evidence Based Policy.

2) National Investment Promotion and Facilitation Agency. (2020). Invest India.

3) Sonal Verma A. N. (2020). COVID-19’s impact on the world economy. Nomura.

4) United Nations. (2020). Economic and social survey of Asia and the Pacific.
Economic and Social Commission for Asia and the Pacific Decade of Action (ESCAP).

5) The Lancet

India's COVID-19 emergency.

Lancet. 2021; 3971683

6)

• Claeson M
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The Swedish COVID-19 strategy revisited.

Lancet. 2021; 3971619

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• Bloom JD
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Investigate the origins of COVID-19.

Science. 2021; 372: 694

8) main.mohfw.gov.in/sites/default/files/FinalforNetEnglishMoHFW040222_1.pdf
ANNEXURE: