COVID-19

Financial Pandemic 2020

Unlocking a write-up on Financial Lockdown

The financial crisis of 2020-21 that is any variety of situations in which some financial assets suddenly lose a large part of it’s nominal value, started in the second quarter of the financial year because of halting of various activities .
It had a major impact on many sector but the first which had the maximum crash was stock market. It shook the entire stock market . On 28th of February, the Indian stock market saw a massive crash where more than ₹5 lakh crores, investors wealth was wiped. The Indian indices registered a fall of 30% overall in March 2020.There was a large fall in the price of oil and a large increase in the price of gold, to a 7-year be high.
The next one to get affected were the employees . Didn’t you see anyone or yourself faced any problem related to unemployment ? You must definitely have. Because currently, every fourth person in India is unemployed. The country has been in lockdown since 25 March to curb Covid-19 infections, causing mass layoffs and heavy job losses. Urban India has reduction of about 26.3% of unemployment while rural parts have 23.7%.
The FMCG sector had also experienced a price rise as there was high demand of food due to lockdown and the Pharma sector had a rise due to high consumption of medicines during the pandemic and news of vaccine .
It has brought a miserable effect on agricultural products due to lockdown the farmers suffered a great loss, though the goods were ready to be sold in the market but not many of us actually came and bought the goods due to the fear of ill effects of corona. Also after that the transportation cost rose up which was unbearable for the farmers to pay.
The economic impact of the 2020 coronavirus 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.
The Indian economy shrank 23.9 per cent in the first quarter of 2020,from April to June, much worse than market forecasts of an 18.3 per cent drop.
This is the biggest contraction on record in India’s statistical history as the Coronavirus-induced nationwide lockdown aggravated an already terrible economic situation.
The world at a large has felt the disaster, where the coronavirus pandemic is evolving and has another round of huge cuts to our GDP forecasts. We now expect world economy activity to decline by 1.9% in 2020 with US, eurozone and UK GDP down by 3.3%, 4.2% and 3.9% respectively. We can now judge that lockdown could reduce GDP across the EU and US by 7% to 8% or 28% to 30% annualized in 2020.
Such effects brings nothing in our minds but the 2008 crisis .Comparing the coronavirus crisis and the global systemic crisis of 2008 is inevitable, but seen through the lens of exogenous and endogenous risk they are not quite different.
The multiple shocks facing young people from the Coronavirus pandemic could result in them being scarred throughout their working lives, creating a “lockdown generation,” the United Nation’s labour agency has warned.

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