Coronavirus outbreak: Indian economy can lose over $29 billion
The magnitude of global economic loss ranges between $77 billion and $347 billion, or 0.1 per cent to 0.4 per cent of global GDP
New Delhi: The Coronavirus outbreak can adversely impact the Indian economy by a whopping $29 billion in a hypothetical worst-case scenario, according to a study conducted by Asian Development Bank (ADB) on the economic impact of COVID-19 outbreak on developing Asia region.
“GDP and employment losses in the worst case scenario from COVID-19 will be in sectors such as agriculture, mining and quarrying ($6.89 billion), business, trade and public services ($15.86 billion), light and heavy manufacturing and construction ($3.39 billion), hotel and restaurants ($1.83 billion) and transport services ($1.93 billion), taking the aggregate losses to $29.91 billion,” said the ADB study.
According to the bank, although the worst-case scenario is hypothetical, it is primarily meant for guiding policy makers in determining how costly an outbreak could be, so that they can properly evaluate the benefits and costs of prevention and early response.
The Coronavirus outbreak has serious implication for the Indian economy. It has disrupted production and transport of key equipment imported for use in solar power plants in India and is likely to jack up the prices of solar power apart from impacting projects’ completion schedule unless urgent measures are taken, according to CII.
ADB said the ongoing COVID-19 outbreak affects the People’s Republic of China and other developing Asian economies through numerous channels, including sharp declines in domestic demand, lower tourism and business travel, trade and production linkages, supply disruptions, and health effects.
The magnitude of the economic impact will depend on how the outbreak evolves. The range of scenarios explored in the ADB brief suggest a global impact of $ 77 billion to $ 347 billion or 0.1 per cent to 0.4 per cent of global GDP. In a moderate case scenario, an impact of $ 156 billion or 0.2 per cent of global GDP is expected.
