15 December 2021
The Socio-economic impact of Coronavirus on India: What kind of Recovery is There?

Brics Seminar | Wednesday December 15th, 2021

The next session of the BRICs seminar will be held Wednesday, December 15th 2021, 4:30 pm (online)
 

Speaker: Prof. Arun Kumar (Institute of Social Sciences, New Delhi).

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Abstract

India was the most impacted economy out of the G20 countries with a shrinkage of 24% in GDP in April to June 2020. As unlock took place starting June 2020, recovery was also expected to be equally sharp. Complacency set in. The government and the people relaxed so when India was struck by a most severe second wave from March 2021 it played havoc with the people, especially those outside the metros. Since July 2021 India is recovering from the impact of the second wave.
The talk will cover the problems in data for analysis of the decline and the recovery given that the Indian economy consists of a very large unorganized sector which has been declining since demonetization in 2016. This sector declined even more sharply during the lockdown and the second wave. The data for this sector comes only once in 5 years so it is assumed that it is growing more or less at the same rate as the organized sector. This assumption does not hold anymore since the two components are moving in the opposite directions.
Alternate data has to be used to assess the impact on the unorganized sector and on the GDP. The official GDP data is incorrect in many ways. International agencies also use government data since they are not data gathering agencies. So, their forecasts are similar to those of the government and therefore they reproduce the flaw in the government data.
The impact and the recovery are uneven across the two sectors, even within the organized sector. For various reasons the stock markets have boomed and inequalities are on the rise. Government used `supply side’ policies rather than taking care of those severely impacted. But these policies cannot help quick recovery since demand is short. If at all they deliver, it will be in the medium and long term but the problem is immediate. 
There is serious impact on employment, health, education and various other aspects of society. The supply side policies pushed pro-corporate sector policies that have led to the biggest year long agitation by farmers. Public sector workers are protesting privatization and monetization of public assets. Thus there is considerable turmoil. There is also serious inflation in the midst of loss of employment and incomes.

We are headed to a New Normal and how will India deal with them is another issue that needs to be addressed. The talk will cover some of these issues.

Details

Seminar on line

Wednesday December 15th, 2021
4:30pm - 6:30pm

Link to the Zoom event
 
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Prof. Arun Kumar is Malcolm Adiseshiah Chair Professor at the Institute of Social Sciences, New Delhi, and author of "Indian Economy's Greatest Crisis" and "Demonetization and the Black Economy", Penguin Random House

Here is a presentation of "Indian Economy's Greatest Crisis" :

Desperate times call for desperate measures.’ The outbreak of COVID-19 aptly justifies this expression as the world faces an unprecedented situation. But what is so unusual about the coronavirus, especially since viral attacks-H1N1, Ebola and Nipah-have taken place earlier as well? How has it affected India and the world? What are the socio-economic implications for India? How has India’s response been to the coronavirus? What is more important-life or livelihood? How can India recover from the sudden economic shock caused by the pandemic?
This book is an attempt to answer these and many more such questions.
The coronavirus hit the world in December 2019 like a hurricane. What started as a medical emergency soon turned into an economic one. No global financial crisis has ever hit humanity as hard as COVID-19. The world, therefore, was caught ill prepared when the pandemic struck. The situation, to say the least, is worse than a war. The situation in India is no different: In terms of the number of cases reported, it is second only to the United States.
This book highlights the enormity of the impact of the coronavirus pandemic on India. It critically examines the government’s efforts to control the disease and mitigate its adverse effects on Indian economy and society. Making a compelling argument that an economy is not like a rubber ball, which, if dropped on a hard surface, will bounce back to its original position, the author provides incisive reasons to why economic recovery will be slow and not ‘V-shaped’. He, however, cogently suggests that good governance, a robust public-health system, and clean and representative politics are key to bringing India’s economy back on track.

Prof. Arun Kumar has also published numerous posts and articles on the recent evolution of Indian Economy, incuding the following:

 

 

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