The Economic Impact of Coronavirus
The Coronavirus outbreak is having a negative impact on the various sectors of the economy.
Impact on Indian Economy:
The Organisation for Economic Co-operation and Development (OECD) has slashed India’s growth forecast for 2020-21 by 110 basis points (bps) to 5.1%, warning that the impact of the Covid-19 outbreak on business confidence, financial markets and the travel sector, including disruption to supply chains, could shave 50 bps off global growth in 2020.
The production facilities in Himachal Pradesh — largest pharma hub of Asia — have warned of suspension.
Active Pharmaceutical Ingredients (APIs), also called bulk drugs, are significant ingredients in the manufacture of drugs. The Hubei province of China, the epicentre of the coronavirus, is the hub of the API manufacturing industry.
India is heavily import-dependent for APIs from China. India’s API imports stand at around $3.5 billion per year, and around 70%, or $2.5 billion, come from China.
China is one of the leading suppliers of auto components in India, accounting for 27% of the total imports.
The coronavirus is expected to have an impact on the Indian automotive industry and therefore also on the automobile component and forging industries, which had already reduced their production rate due to the market conditions and on account of the impending change over to BS-VI emission norms from BS-IV from April 2020.
On 28th February, the Indian stock market registered one of its worst crashes in a single day. Indian indices fell over 3.5%, marking the second biggest fall in Sensex history.
The Sensex plunged 1,448.37 points to close at 38,297.29, while the Nifty tanked 3.711% or 431.55 points to settle a little above the 11,200 mark.
The Sensex’s worst fall in history was on 24th August, 2015, when the indices fell 1,624 points on the back of a slump in the Chinese markets and rising crude oil prices.
The month of March is typically good for the Indian currency as remittances, from both overseas citizens and companies, tend to boost the exchange rate.
In the past decade, the rupee has appreciated seven times against the dollar in March. But March 2020 could be hard on the exchange rate and the rupee’s sharp drop to 73.25 per dollar on 3rd March, 2020 is evidence of this. One of the reasons is an increase in the number of reported cases of coronavirus in India.
Consumer goods giant Reckitt Benckiser, for example, has seen a boost in sales for its Dettol and Lysol products.The disinfectant is seen as providing protection against the spread of the disease, although its effectiveness has not yet been scientifically proven.
The price of gold – which is often considered a “safe haven” in times of uncertainty – has also increased. Its spot price hit a seven-year high of $1,682.35 per ounce in February 2020.
Pi Day is celebrated on March 14 dedicated to Pi (Greek letter π). The idea originated in the United States, where the convention is to write dates in a format that expresses March 14 as 3/14. These three digits match the value of pi up to two decimal places, at 3.14.
By definition, pi is the ratio of the circumference of a circle to its diameter. Pi is also the area of a circle divided by the square of its radius. The ratio is always constant.
Pi is an irrational number, it is denoted by a symbol ‘π’.
Pi has its use in geometry, trigonometry, physics, astronomy and other sciences. It appears in various formulae. Few important formulae are:
1) Area of a circle is πr2.
2) Volume of a cylinder is πr2h.
3) Surface area of a sphere is 4πr2.
4) Volume of a sphere is 4/3 (πr3).
5) Volume of a cone is 1/3 (πr2h).
The Ministry of Shipping has launched a roll on-roll off cum passenger ferry service, called ‘ROPAX’, between Mumbai and Mandwa (Maharashtra).
Key Points :
ROPAX service is a water transport service project under Eastern Waterfront Development.
The road distance from Mumbai to Mandwa is about 110 kilometres, and it takes three to four hours, whereas by waterway the distance is about 18 kilometres and a journey of just an hour.
ROPAX Vessel M2M -1 was built in Greece in September 2019. This Vessel has a speed of 14 knots and can carry 200 cars and 1000 passengers at a time. It is capable of operating even in a monsoon season.
People will be able to travel in their cars directly on to the ROPAX vessel.
The benefits of this service include reduction in the travel time, vehicular emission and traffic on the road.
Video Conference of SAARC Leaders on COVID-19
The Video Conference of South Asian Association for Regional Cooperation (SAARC) Leaders on COVID-19 was held recently.
All the members of SAARC (India, Bangladesh, Bhutan, Nepal, Maldives, Sri Lanka, Afghanistan and Pakistan) attended the conference.
The conference is considered as a step towards the revival of SAARC as the SAARC Summit has not taken place since 2014 because of India-Pakistan tensions.
India has proposed to create a COVID-19 Emergency Fund which could be based on a voluntary contribution from all SAARC members.
Further, $10 million has been extended by India as a contribution to the fund.
The fund can be used to meet the cost of immediate actions by any member and will be coordinated through foreign secretaries and embassies of the member countries.
The World Health Organisation (WHO) has also constituted the COVID-19 Solidarity Response Fund with the help of corporate bodies, foundations and the UN Foundation.
India has also proposed a rapid response team of doctors and specialists, along with testing kits and other equipment for all the member countries.
India has set up an Integrated Disease Surveillance Portal to better trace possible virus carriers and the people they contacted. India has offered to share it with member countries.
The conference also discussed longer-term economic consequences of COVID-19.
The member countries have also proposed to insulate internal trade of South Asia and local value chains from its impact.
It has been decided to frame and enforce the common SAARC pandemic protocols.
The members have also decided to establish a working group of national authorities for health information, data exchange and coordination in real-time.
It has also proposed a SAARC health ministers’ conference and the development of regional mechanisms to share disease surveillance data in real-time.
Afghanistan has highlighted the vulnerability as it shares a long and open border with Iran, one of the worst affected countries in the world.
The Maldives has cited the economic downturn owing to the drop in tourists inflow from Italy, China and Europe – the main source of tourists for the country and sought a South Asian response to the crisis.
The tourism-dependent countries like Bhutan, Sri Lanka has also sighted issues related to the economic slowdown.
Invocation of Disaster Management Act, 2005 to Deal with COVID-19
Various government authorities have invoked their respective powers under the Disaster Management (DM) Act, 2005 to deal with the novel coronavirus (COVID-19) outbreak in the country.
The powers exercised by the home secretary for being the Chairman of the National Executive Committee (NEC) under section 10 of the DM Act (2005) have been delegated to the Ministry of Health and Family welfare.
Section 10 evaluates the preparedness at all governmental levels for the purpose of responding to any threatening disaster situation or disaster and give directions, where necessary, for enhancing such preparedness.
It also lays down guidelines for, or give directions to, the concerned Ministries or Departments of the Government of India, the State Governments and the State Authorities regarding measures to be taken by them in response to any threatening disaster situation or disaster.
Thus it majorly monitors and implements the national plan and the plans prepared by the ministries or departments of the central government and gives superintendence power to the officer executing plans.
The delegation would help to enhance preparedness and containment of novel coronavirus (COVID-19) in the country.
Some of the district authorities in the COVID-19 affected states like Maharashtra have also invoked power under the DM Act.
The Act gives power to the district administration under Sections 33 and 34 to deal with any disaster-related situation.
Under Section 33 and 34 the district authorities may opt for requisition powers for any officer or any department at the district level or any local authority to take measures for prevention or mitigation of disaster or to effectively respond to it and such officer or department is bound to carry out such order.
This step will help to create awareness among the public regarding COVID-19 and will also help to regulate the medical supply of masks, injections and medicines, etc.
National Supercomputing Mission
Recently, a Right to Information (RTI) reply has revealed that India has produced just three supercomputers since 2015 under the National Supercomputing Mission (NSM).
NSM’s first supercomputer named Param Shivay has been installed in IIT-BHU, Varanasi, in 2019. It has 837 TeraFlop High-Performance Computing (HPC) capacity.
The second supercomputer with a capacity of 1.66 PetaFlop has been installed at IIT-Kharagpur.
The third system, Param Brahma, has been installed at IISER-Pune, which has a capacity of 797 TeraFlop.
The NSM envisaged setting up a network of 70 high-performance computing facilities in the country but skewed funding for the mission during the initial years slowed down the overall pace of building supercomputers.
Only 16.67 % of the total budget of Rs 4,500 crore, has been utilised during the last four-and-a-half years for execution of the mission.
Globally, China has the maximum number of supercomputers and maintains the top position in the world, followed by the US, Japan, France, Germany, Netherlands, Ireland and the United Kingdom.
National Supercomputing Mission:
The National Supercomputing Mission was announced in 2015, with an aim to connect national academic and R&D institutions with a grid of more than 70 high-performance computing facilities at an estimated cost of ₹4,500 crores over the period of seven years.
It supports the government’s vision of ‘Digital India’ and ‘Make in India’ initiatives.
The mission is being implemented by the Department of Science and Technology (Ministry of Science and Technology) and Ministry of Electronics and Information Technology (MeitY), through the Centre for Development of Advanced Computing (C-DAC), Pune and Indian Institute of Science (IISc), Bengaluru.
It is also an effort to improve the number of supercomputers owned by India.
These supercomputers will also be networked on the National Supercomputing grid over the National Knowledge Network (NKN). The NKN connects academic institutions and R&D labs over a high-speed network.
Under NSM, the long-term plan is to build a strong base of 20,000 skilled persons over the next five years who will be equipped to handle the complexities of supercomputers.