Economic impact of COVID-19

Among the various devastating consequences of coronavirus pandemic, economic impact is the most troubling and formidable challenge to the world to bear in the form of heavy losses in economic terms along with loss of human lives.
No nation is spared to it is developed as well as developing economies are struggling at the same time on two fronts. Firstly, to flatten the curve of rising number of infections which is impossible and uncertain to do that? At some extent, western world and Europe has overcome the challenge. But, the developing countries are badly hit by global pandemic. Secondly, due to economic shutdown, according to IMF, the world will experience a recession first time after 2008 global financial crisis. The world economy will recede 3 percent in current year, if pandemic continue to wreak havoc in same quantum.
As far as, Pakistan’s economy is concerned, Pakistan faced an economic loss of up to Rs. 2.5 trillion. Gross Domestic Product (GDP) had shrunk from Rs. 44 trillion to about Rs. 41.5 trillion, down by Rs. 2.5 trillion. Another estimate put the loss at about Rs. 1.6 trillion based on growth rate. The GDP was originally estimated to grow by 3 percent in current fiscal year, but it contracted due to pandemic by 0.4 percent.
Presently, the government is busy in formulation of budget for fiscal year 2020-2021. This will be the giant task in front of incumbent government to adopt the people friendly measures in budget, and also bear the pressure of IMF while chalking out policy for year. Already, government has announced a stimulus package of 1.2 trillion to bailout business and also helps working class in the time of crisis.
However, the real challenge that stands in front of Imran Khan led government is to sustain pressure of unemployment. As per estimates of, Pakistan Institute of Development Economics (PIDE) 80 million people have lost their jobs due to lockdown, which could instigate socio-economic problem at large in the country. The government has relaxed the lockdown in country to lessen the economic burden over already struggling economy and has opened business activity in the country; but, it is just like playing with fire. Pakistan still is away to touch the peak in mid-June in terms of infections. So, restraining lockdown can be more hazardous for country.
Currently, it seems that the government is clueless and uncertain as far as a number of cases are concerned. On daily basis, they explained overall situation of corona virus in front of media along with PM Imran Khan, but persistently condemn lockdown, even they know the number of cases are rising sharply, and will touch peak in coming days. Still they are stick to protect economy, than people’s lives. And this is also a fact, our economy was already in bad condition, and pandemic had further worsened the situation. At a same time, risking the lives of nation is bad decision.
Government needs to understand, healthy nation is a wealthy nation. Health of people in this testing time should matter the most for rulers, not risking their lives. Ruling elite must learn the lesson of other nations where pandemic hit first. They continued lockdown till the curve started to flat amid coronavirus.
Undoubtedly, government had taken few measures to provide relief to people during this crisis. They curtailed the oil prices to 70 rupees from more than 100 per liter. But this is not working in peoples favor, because patrol stations have stopped selling the fuel, and closed the stations. From all over country, complains of fuel shortage are coming which has hindered people to receive the fruit of cheap prices. Additionally, prices of consumer goods are still skyrocketing. Ordinary people are still suffering at the hands of mafia. Again, there is a news that temporary flour crisis is under way in coming days. Therefore, the incumbent government needs to look in woes of people resulting from economic crisis due to COVID-19.