As the coronavirus threat looms over the world , countries are facing a Catch 22 situation where they are in a dilemma to save lives or livelihoods. It is reported that around 25 million people will lose jobs due to the pandemic. Payrolls have slumped and labor market has dealt an irreplacable damage. Countries have drained their resources and economic assets in dealing with this health crisis as all infrastructural work has come to a halt. All sports activities have been suspended , schools and colleges have been closed and people have been barred from going out for unessential commodities. Countries are set to lose trillions of dollars as the health crisis is gradually taking the shape of a major labor market and economic crisis. Stock markets have taken a big hit as Dow and the FTSE saw their biggest quaterly drop since 1987. For the first time in history ,oil prices have plunged below zero and oil shares continue to decline day by day.

Coronavirus has had a severe impact on the Indian Economy. The developing nation was already struggling in keeping its economy afloat before coronavirus hit its shores. The nation , not known for its healthcare , opted for a complete lock down since March 25. This has aggregated unemployment in the country as it tries to provide food to the needy. Most credit rating companies have drastically cut India’s FY21 GDP forecast from their early projections. The forex reserves are dying , export has taken a hit and rupee is crumbling down. Business faces an uncertainity as government has projected a budget deficit of 3.5% of GDP in the year throughout March 2021 but it is estimated it may reach 6.5%.

The pandemic is also a chance for India to fix its ailing sectors and attract more foreign investment to the country. India needs to liberalize and deepen its financial markets and take policy steps to fix the banking and farm sectors. India has had a history of taking reform steps during periods of crisis, For eg- in 1991-92 it freed private sector from government controls , deregulated financial markets , reduced import tariffs and opened up the economy for more foreign investments to avoid a balance of payment crisis. There are early signs that the government is grabbing this opportunity as overseas investors are getting a greater access to its sovereign bonds , allowing local banks to tap offshore currency markets and companies a choice of more complex hedging tools. It is reported that the Indian government is also preparing a humongous land to lure the foreign companies leaving China to invest in the South-East nation.

As the world recovers from the global pandemic , it must prepare itself to face one of the greatest economic crisis ever if necessary steps are not taken at the right time.