Indian Economy is completely dismantled in COVID-19 pandemic in 2020.But will it rise again? In present scenario, the answer is definitely ‘No’. This is an opinion article on How Indian Economy is getting destroyed in 2020 and direct or indirect impact on Indian youth. We will analyze every aspects with proper data and statistics. Let’s learn.
India is sinking as a Nation. It is a ‘now or never’ situation for India. The slow and structural annihilation of my nation left me trembled. The never seen side of the era of corruption, wrong and unsuitable timing of implementation of policies one after another, playing with futures of Indian Youth, mishandling the entire banking system in the country, prolonged and aggravated attack on Indian Educational Institutions are playing key roles to dethrone from the spot we belong.
The seismic wave of demonetization (November 8, 2016) brought a significant negative hit in all segments, especially in Industrial and farming sector.Demonetization was done to curb corruption of black money and to combat terrorism.But it is RBI who confirmed in RBI report 2017-18, that most demonetized notes were returned to the central bank.So this move came out as a false one which caused a critical shock and disruption not only to Banking Industry and bank employees but also to 130 crore Indians.And as far as terrorism is concerned look at this data.
The country was still in high and dry situation after the demonetization and Goods and Services Tax was introduced on July 1, 2017.Real estate sector came to a standstill situation.Sectors like Textile, Pharma, IT and Telecom got burned of a higher tax rate.Back to back implementation of Demonetization and GST have been a huge blow to Indian Economy.
Banking Industry is currently the most ignored sector in the country.Let’s start with PM Modi’s vision of Financial Inclusion of Jan Dhan accounts.Approximately 40 crore Jan Dhan accounts were opened by Bank employees. Yojanas like Atal Pension Yojana,Pradhan Mantri Suraksha Bima Yojana,Pradhan Mantri Mudra Yojana,Prime Minister Jeevan Jyoti Bima Yojana,Sukanya Samridhi Yojana have been implemented at a continuous pace since 2014.But loans taken under Pradhan Mantri Mudra Yojana are becoming NPAs due to poor structure and guidelines governed by the policy makers.Rs 68,600 crores loans of willful defaulters have been written off and then what’s next? The cycle will continue.One after another corporate loans are becoming NPAs.
Household debts are increasing exponentially compared to the income since the implementation of Demonetization.Now PM Modi urged banks to provide collateral-free loans. Hence Banks and NBFCs are aggressively disbursing loans.People are taking loans beyond their income to survive. They are even uncertain of the future & then forced to default.Therefore the person who is already in debt or having zero savings,will now bear the burden of loans.The poor will become poorer and weak will become weaker.This is real face of Economic crisis in India.
There is a saying “Poor people are easier to rule.”
Indian Economy and COVID 19
COVID-19 pandemic has created more deeper wounds than we anticipated. Starting from announcement of Lockdown in India to unlock process, Indian Government has been a damp squib.Sudden announcement of lockdown created a chaos among migrant workers in India.It made them dispersed and unsettled, which eventually caused even more infection in the country at the later stage.Now manufacturing industries have come to a pass as there is an acute shortage of workers (migrant workers crisis in India).Some states like UP,MP have taken advantage of the lockdown and diluted labour laws ,which eventually made them scared and unsafe.No initiative has been taken so far from Government to make them aware of COVID 19 situation and bring them back to the industrial work flow.
Now talk about the Economic stimulus package of 20 lakh crore which is approximately 10% of India’s GDP, announced by the Indian Government.The package is expected to stabilize MSME business,migrant workers and farmers across the country.
In this context Indian Government has three options.
- Printing new currency
- Borrowing from EXTERNAL & INTERNAL markets
- Austerity measure like cutting down on expenditures and promoting internal production
Countries like USA,Japan,Canada,Australia too announced huge economic stimulus package and they have opted for printing new currency. As the dollar has highest value currency in the world, the countries will be able to survive the aftermath of it i.e. inflation. Printing new currency will result in inflation and it will increase the National debt. Indian Government and RBI is avoiding to print currency to avoid hyperinflation situation.The next option is borrowing from External and Internal markets.But this will increase the interest rate.So Is Indian Government cutting down on expenditures? The answer is ‘yes’ although that would not be enough to finance the stimulus package.Hence comes the Atmanirbhar Bharat with an aim to make a self-reliant country to boost manufacturing and production in the country along with the active participation and empowering the poor, laborers, migrants who have been adversely affected by COVID-19
The Uncertain future of Agriculture, Industry and Services sector will haunt the Economy of the country. As it was stated earlier that Atmanirbhar Bharat will include 10% of GDP,but further analysis and calculations suggest that the actual government expenditure in the Atmanirbhar package is just 1% of GDP. Atmanirbhar Bharat will include agendas like
- Increase in borrowing limits
- Privatisation of Public Sector Enterprise (PSEs)
- Collateral free loans for businesses
- Corpus for MSMEs and subordinate debt of MSME
- Schemes for NBFCs
- Statutory PF contribution
- Insolvency resolution
- Reduction in TDS and TCS rates
- Ease of doing business for corporates
- Agricultural support
- Employment push using CAMPA funds
- One Nation One Card for migrant workers
- Public Private Partnership (PPP) model for airports etc
Now there is a question.If the domestic production gets a boost through Atmanirbhar Bharat, how will it finance the ‘10% GDP’ ? The global demand is at sharp decline as well, so the net exports will barely get a rise.
Now look at other side of the coin too.The research report published by National Council of Applied Economic Research (NCAER) states that India’s GDP will decline by 12.5% under the Base case scenario.The Government need to spend more and counteract the natural downward spiral of the economy to lift the economy back.
Job Losses in India
Recently International Labour Organization and the Asian Development Bank jointly published a report called ‘Tackling the Covid-19 youth employment crisis in Asia and the Pacific’.The report says that approximately 41 lakh youth in India lost their jobs amidst COVID-19 pandemic, an the report also cited that the most job losses were encountered in the construction and farm sector.
Private sectors do not provide job security.Hence the job losses. Atmanirbhar Bharat includes Privatisation of Public Sector Enterprise as one of it’s top agenda.Therefore it will eat up the existing jobs too in the future.
New Government Job Crisis
The top three recruitment agencies in India (Excluding UPSC) are Staff Selection Commission (SSC), Railway Recruitment Board (RRB) and Institute of Banking Personnel Selection (IBPS).Now look at the vacancy trend of these agencies over the years.
SSC reported 16119 vacancies in 2012,but in 2019 it is 8582 i.e almost 50% vacancy has been eaten up during current Indian Government. IBPS reported 21680 vacancy in 2013 but only 1167 in 2020 i.e 94% vacancy were vanished.Railway Recruitment Board (RRB) released a job notification of 90000 vacancy for RRB NTPC and RRB gr D posts on 1st March,2019. Total 2.86 crore students applied against the job vacancies.Indian Railways Collected 864 Crores from the application fees of RRB NTPC and RRB Group D posts. But RRB still at sea in finalizing the recruitment vendor for the exam.
What would you call this?The biggest job scam or corruption or negligence?
Attack on Educational Institutions
Indian youth in Educational Institutions is undergoing through multi-layered attacks from governments in form of fee hike or sometimes in the form of hooliganism by the outsiders. For instance,consider the essence of brutality of outsiders in JNU university and Jamia Millia Islamia university. Sometimes cops become the assaulter of the students as seen in case of JNU university and Jamia Millia Islamia university. But the central government kept silent on both issues.Indian Youths are labelled as ‘Anti-National‘ or ‘Urban Naxals‘ if they speak against the Government.
Impact on NEET-JEE Students
The most recent issue of NEET-JEE students is not only irrational but also reflects the greatest level of hypocrisy by the Government.When India is passing through highest ever infection rate of COVID-19, the students are being made obliged to appear for the NEET-JEE. Many places are still under flood in the several corners of the country.The government is silent on that.There is no public means of transportation. It will become impossible for poor students to afford private cars in current lock down situation in different parts of the country.The government is silent on this issue too.Students are demanding to postpone NEET JEE for at least few months.But who cares?
Narendra Modi came into power by promising new job creation for the Indian Youth. But now, new Government job is not only a beside the mark topic but also it is proved to be a fool’s errand. Existing private sector jobs are getting scrapped,existing government jobs are also getting scrapped due to hard nosed attitude of government towards Privatisation of Public Sector Enterprise (PSEs). Government of India has lost it’s limit and dignity as it is collecting funds by promising RRB NTPC and Group D jobs. Government of India should clear the existing vacancy of SSC and RRB in priority basis before implementing New Education Policy or National Recruitment Agency (NRA). It is disrespectful and disturbing to watch that Government of India wants to conduct NEET-JEE amidst worst situation of COVID 19 but taking 3-4 years to conduct SSC,Railways exams.What will happen if the students clear JEE and become engineer? The country already is in crisis with educated unemployed. As per reports released by Forbes 80% engineers in the country are unemployed.It is high time for Indian Youth to fight for their right and dignity and it is also urged to Indian Government to take some immediate steps to address the issues discussed in the article. Or else we will sink as a Nation.