No way out?
The economic downturn resulting from the second wave, and the mismanaged vaccination drive have left us with limited options
The second wave resulting from the new variant continues to rage across the country. The virus is ruining the lungs of the infected person even before its presence is detected in the body, leading to reduced oxygen levels, and consequently more deaths in comparison to the first wave.
Mismanagement of the situation is also a major cause of death. Many people have lost their lives due to lack of oxygen. There is also a huge shortage of vaccines across the country. Among the people aged 45 or above, 10.93 million received the first dose of the vaccine until May 11, while only 2.29 million people received the second dose. In the meantime, on May 13, the gap between the first and second doses of the Covishield vaccine was increased to 12-16 weeks from the existing 6-8 weeks, which the government said will increase the efficacy of the vaccine. Vaccination of the age group 18-44 seems to be a daydream presently with only 25.59 lakh people having been vaccinated in this age bracket.
In the second wave, many factories are closed again or their production is limited. Several states have imposed lockdown across the country. Due to the shutdown of economic activities, wages have been affected and workers have returned to their villages. Center for Monitoring Indian Economy (CMIE) data shows about 7.5 million people have lost their jobs in the organized sector, while the unorganized sector, too, has witnessed millions of job losses. The unemployment rate has reached around 8 per cent in April 2021, compared to 6.5 per cent in March.
Lockdowns and the economic downturn in rural areas have destroyed small enterprises. Owing to a lack of salary or wages, people are using their accumulated deposits in banks to meet their daily needs. For this reason, for the first time in the last eight months, the balance amount of Prime Minister Jan Dhan accounts has decreased in April. On April 28, the balance amount of Pradhan Mantri Jan Dhan accounts decreased to Rs 1,43,397 crore, from Rs 1,46,084 crore at the beginning of the month. In this way, Rs 2,787 crore was withdrawn from Prime Minister Jan Dhan accounts in just 28 days. Different states have seen different reductions, depending upon the effect of the pandemic.
There has been a decline on many important economic indicators. The number of passengers going to offices has fallen by 46.3 per cent, while the number of people going out for entertainment and other reasons has fallen by 58.3 per cent. Even shopping for essential items like groceries and medicines has come down by 18.7 per cent.
Owing to the closure of factories, electricity production and consumption has gone down in 2021 as compared to 2019. Traffic congestion in metros like Mumbai and New Delhi is about 80 per cent less than normal days. Also, according to data from Indian Railways, there has been a higher freight percentage compared to last year showing that businessmen or companies are using rail for transportation.
According to the Federation of Automobile Dealers Association (FADA), the total registration of vehicles in India declined by 29.85 per cent to an eight-year low of 1,52,71,519 units in the financial year 2020-21. During this period, there has been a decline of 31.51 per cent in the registration of two-wheelers, 64.12 per cent in three-wheelers, 49.05 per cent in commercial vehicles and 13.96 per cent in passenger vehicles. However, there has been an increase of 16.11 per cent in the registration of tractors from the previous financial year.
Global rating agency Fitch reported that economic recovery will suffer a major setback after the second wave. The agency also projected the possibility of a third wave due to the slow pace of vaccination in the country.
A provision of Rs 35,000 crore has been made for the vaccination from the "Transfer to States" funds of Budget 2021-2022. Quarterly control restrictions will not apply to these expenditures. Vaccination is the only way to check the second wave and avoid the third wave. Also, the Defense Research and Development Organization (DRDO) has recently invented the anti-Covid oral drug, 2-deoxy-D-glucose (2-DG), which has been approved for emergency use as an adjunct therapy in moderate to severe coronavirus patients by the Drugs Controller General of India (DCGI). It is being said that this drug has been successful in trials to reduce the effect of Coronavirus. This medicine has been launched on May 17, 2021.
It can be said that in the current scenario, vaccination and medicines are the only ways to defeat the virus, but due to lack of concrete plan and mismanagement, the work of vaccination is not going on smoothly. Many corona-infected people have died in the past. There has been an atmosphere of fear and uncertainty throughout the country. Under these circumstances, the states are opting for lockdown to prevent the pandemic from spreading further. Apart from this, it is being said that a nationwide lockdown like last year is the only option left. This, however, will lead to a complete halt of economic activities which will weaken the economy further.
Views expressed are personal