The Coronavirus infection has been hurting the economy ever since it’s spread and is on its verge to lead to a much-dreaded recession in India. To speak of the global pandemic fishtailing the world’s economy, if you think India is already facing the recession, then you are certainly right. Where India’s economic growth rate has reached around 7-8% of the GDP in recent years, it’s now taking a down ride to 3-4%. But the concern wakes up, will the nation save itself from the consequences of novel Coronavirus (COVID-19) stinging its tail everywhere?
With the ever-increasing panic amid global pandemic, the economy is trapped inside its domino-effect leading to the suspension of trade routes and operational business activities all around the world – causing a recession. It is evident that panic and shock are likely to dampen domestic demand around the world which surely will affect an array of non-traded activities across nations and regions altogether.
Stock Market: The dip in the Indian stock market has been witnessed- the Sensex plunging to 5 percent of its market value, just on the day prior to the occasion of Holi. It happened to be the biggest single-day fall since the financial crisis that occurred in 2008, the last time the world was in serious threat of recession. It is assumed that India may have to trade a loss of 348 Million Dollars due to the life-threatening corona outbreak.
Travel industry and Aviation: Travel & Tourism industry is deeply hurt due to Coronavirus flare-up; affecting the travel industry sector and earnings.
Materials Industry: Due to stopped operations in clothing/manufacturing plants in China, the prices of texture, yarn and other basic materials are highly influenced.
Hardware Industry: The Hardware industry is highly impacted due to supply interruptions of gadgets required in India.
Pharmaceuticals Industry: The business under the pharmaceutical industry depends dynamically on the import of mass medications. Due to the Coronavirus pandemic, the pharma business will likewise be affected.
The market volatility can be the silver lining to many in the stock market. It is foreseen as a golden opportunity to buy equities. India’s exposure to the worldwide economy is on fall due to limited country presence in the global supply chain.
It is anticipated that the crash in oil prices will be of great help to enhance India’s economy since 80% of the petroleum requirements in India are imported. To meet the financial crisis in the best way possible, the crash in oil prices will bring lost hopes to scale up the economy.
Opinions by financial experts claim that if the infectious disease stretches beyond June-July, it is likely to hurt the Indian banking sector, they may have to bear with unavoidable pressure if it has exposure to industries highly depending on China. A plunge in stock market prices will put into the financial industry’s woes. Also, it will be fair justice to say that shortage in supply due to production cuts will lead to inflation too.
Below-listed are a few steps to be prepared for the recession:
- Employed individuals should ensure their job security before an anticipated recession hits. It is highly important to show your worth in the areas you hold expertise. It is recommended to start developing skills that are required in your company and assure your irreplaceable position in your company.
- To network with different people in different areas would pay off in the near future when the recession hits the economy and the job would be a basic need. Networking can help in bringing professional development opportunities in times of need.
- Luxury expenses should be cut off to be better prepared for the foreseen recession. It will be wise to save for the near future in case of any emergency fund required. Money spent on cable TV, shopping, etc. can be cut off to be recession ready.
- During a recession, the rate of unemployment skyrockets and people tend to lose their jobs. In that uncertainty, it is advised to update and refine your Resume/CV in case you lose your job. Individuals with an updated resume will be ready to apply for new job positions quickly and smoothly.
It is high time that India becomes cautious given the rising global pandemic and prepares for a foreseen and unavoidable recession.