Indian economy cannot afford lockdown extensions

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As India completes one month under complete lockdown, experts have started asking the practicality of any more of such an exercise. Lockdown has come as a deathly blow to the infrastructure of Indian economy as well as the livelihoods of millions of Indians. The lack of resources and inability of government relief packages to reach the needy has brought countless families to the brink of starvation.

Congress leader Rahul Gandhi has said the priority of the government should be to provide food and livelihood to the impoverished masses in this crisis. Those earning their daily living are falling prey to starvation due to the COVID-19 lockdown. No problem can be solved with anger and hatred. In this crisis, it should be the priority of the government to provide food and livelihood to our destitute brothers and sisters.

Apart from impoverished farmers, manufacturers of summer products have begun feeling the heat of the extended lockdown. And, with normalcy in operations and retail activities nowhere in sight, they have been forced to redraw their yearly plans and targets.

The extension of the lockdown dashed their hopes of a revival in sales from mid-April. With states in North India imposing stricter measures to curb intra-state movement after April 20, makers of summer products such as air conditioners, refrigerators, colas, and ice creams are estimating a 60 per cent drop in annual sales.

Key markets like Delhi, Punjab, Haryana, and Uttar Pradesh have introduced stringent measures to minimise movement across states. Together, these four, along with Rajasthan, contribute to 40 per cent of sales for most summer products.

According to Fitch Solutions, a medical agency, extending the nationwide lockdown by nearly three more weeks to May 3 is unlikely to stem the surge in coronavirus infections and economic and humanitarian crisis will exacerbate due to slow response by the government.

The carriers of the virus can be asymptomatic, which means that many carriers can go undetected and still spread the virus.

Secondly, large crowds of rural migrant workers have gathered at the transport depots in hopes of getting a ride back to their rural villages upon the announcement of the lockdown extension on April 14, and also back when the lockdown was first announced on March 24 all over the country.

India’s unemployment is also breaking all records amidst the lockdown, it rose to 26.2 per cent in the third week of April amid coronavirus lockdown. The extended lockdown is only expected to further hit the labour market conditions, Mahesh Vyas, Managing Director and CEO, Centre for Monitoring Indian Economy (CMIE), said. “The employment rate has fallen from 40 per cent in February to 26 per cent now. This is steep fall of 14 percentage points.

This implies that 14 per cent of the working age population has lost employment,” he also said in an article on the CMIE website. Fourteen crore people are expected to have lost employment in the lockdown period and the labour markets in urban and rural areas are equally under stress.

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