SBI Report/COVID-19 Impact on Economy: In the current era, the highest number of cases are coming to India on daily basis of COVID-19. For the past several days, 50 to 60 thousand or more new cases have been reported here every day. The number of corona virus patients in the country has increased to 27 lakhs and it has crossed 50 thousand deaths. At present, the COVID-19 epidemic and the lockdown due to it have made a profound impact on the country’s economy. Given the current impact, a blockbuster movie “The Good, the Bad and the Ugly” which came out 54 years ago! Miss of SBI EcoRap report has also come in this regard. Know what for the economy in the time of epidemic
Good, what is bad and what is Ugly.
GOOD News: Estimates of declining GDP decreased
In May, in a report of State Bank of India, the country’s GDP was expected to fall by more than 20 percent in the first i.e. June quarter of FY 2021. But now SBI economists have predicted a 16.5 per cent decline in the country’s gross domestic product (GDP) in the first quarter of the current financial year. In the current uncertain scenario with some conditions, the experts have now changed their estimate after the revision of the economy.
The SBI ECORAP report said that as far as the results of the listed companies are concerned, the corporate GVA (better than expected for some financial and non-financial companies) has been better than the earnings decline in FY 2020-21. Results of the companies listed so far have shown that the gross income of the companies has fallen by more than 25 per cent, while the net income i.e. profit has been reduced by more than 55 per cent. However, the decline in corporate GVA (gross value addition) is only 14.1 percent.
According to the SBI report, theoretically the cost of the listed companies’ income has been offset by rationalizing the cost. This did not affect the margins of the companies.
BAD News: Corona patients increased in rural areas
According to the SBI report, in July and August, the effect of corona virus has increased in rural areas. The share of rural and small districts in total new cases has increased to 54 percent. According to the report, the number of rural districts where there were less than 10 corona virus cases. Andhra Pradesh and Maharashtra are more affected by the increasing cases of corono virus in rural areas. The share of these districts in the Gross State Domestic Product (GSDP) of their respective states is about 2 to 4 percent.
UGLY News: Death toll may increase
The report estimates the state-wise excess mortality rate (average 16% across all states) in addition to COVID mortality due to a 10 percent drop in state domestic product. The results are worrying and indicate that there may be a 0.5–3.5 percent increase in mortality. In fact, hospital beds are quite low in many states like UP, Bihar, West Bengal per 1 lakh population. It is the highest in Karnataka followed by Maharashtra.
According to the report, the total loss in GSDP due to COVID-19 will be 16.8 percent. State-wise analyzes indicate that the top 10 states account for 73.8 percent of the total GDP loss. Maharashtra’s contribution in this is 14.2 percent. It is followed by Tamil Nadu (9.2 percent) and Uttar Pradesh (8.2 percent). According to EcoRap, the per capita loss on all India basis is around Rs 27,000. In Tamil Nadu, Gujarat, Telangana, Delhi, Haryana, Goa, the loss is about Rs 40,000 per person in 2020-21.