Socioeconomic impact due to COVID-19: An empirical assessment

Abstract

Starting from December 2019, the novel COVID-19 threatens human lives and economies across the world. It was a matter of grave concern for the governments of all the countries as the deadly virus started expanding its paws over neighboring regions of infected areas. The spread got uncontrollable, thereby leaving no choice for the nations but to impose and observe nationwide lockdown. The lockdown further sorely hit many sectors, which in turn impacted the economy. Manufacturing, agriculture, and the service sector - the three pillars of the economy - have been adversely affected giving a major slow down to the economy belonging to every nation. Several schemes and policies were introduced by different state and central governments to absorb the impact of subsequent lockdowns on individuals. In this paper, we present a then and now analysis of the economy using a socioeconomic framework focusing on factors- unemployment, industrial production, import-export trade, equity markets, currency exchange rate, and gold and silver prices. For all these, we consider India as a case study because the Indian sub-continent has a wide landscape and rich cultural heritage presenting itself as a potential hub for economic activities. A thorough assessment has been made for the period January 2020- June 2020. The assessment will be beneficial to observe the long-term impact of any infectious disease outbreak such as COVID-19 locally and globally.

Keywords: COVID-19; Economy; GDP; Industrial production, Stock market, Unemployment, India.

Fig. 1

Framework outlining the policy interventions on socioeconomic factors.

Fig. 2

Variation of Estimated Unemployment Rate (%) with Lockdowns in Urban and Rural areas.

Fig. 3

Worst hit Indian states due to nationwide lockdown (Unemployment rate)¹¹.

Fig. 4

Monthly IIP comparison as per use-based classification for Pre and during lockdown periods.

Fig. 5

Monthly Sectoral Indices of industrial production comparing IIP in pre and during lockdown periods¹².

Fig. 6

Trade Performance during April to May in 2019 and 2020.

Fig. 7

(a-b): Amount of India's International Trade of Oil and Non-oil goods from October 2019 to May 2020.

Fig. 8

Comparison of India's Export Trade for different commodities in pre-lockdown, lockdown, and unlock phases.

Fig. 9

Comparison of India's Import Trade for different commodities in pre-lockdown, lockdown, and unlock phases¹⁵.

Fig. 10

Growth Rate of Export Trade of Top 10 commodities from April to May in the year 2019 and 202,0¹³.

Fig. 11

Growth Rate of Import Trade of Top 10 commodities from April to May in the year 2019 and 202,0¹³.

Fig. 12

India's International Trade in services during pre-lockdown and lockdown phases.

Fig. 13

Closing prices (in Rupees) of NIFTY 50 from Nov. 2019 to July 2020^,.

Fig. 14

Comparison of Closing prices (in Rupees) of different NIFTY indices from Nov. 2019 to July 202,0¹⁷.

Fig. 15

(a-b): Compares the NEER and REER indices of the Indian rupee for the FY19 and FY20¹⁶.

Fig. 16

Monthly Average of Gold and Silver in domestic and foreign markets¹⁶.