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Indian economy also to be influenced by Coronavirus shocked the Chinese economy

Wednesday - January 29, 2020 11:38 am , Category : WORLD
Coronavirus shocks China's economy
Coronavirus shocks China's economy

Coronavirus to affect the economy of many countries of the world including India

JAN 29 (WTN) – Coronavirus spread from China is slowly spreading its wings all over the world. The Novel Coronavirus (nCoV) spread from the Chinese city of Wuhan is becoming a challenge for the Chinese government. Due to the spread of Coronavirus in China, there is an atmosphere of concern among the countries bordering China including India. For your information, let us know that due to the attack of Novel Coronavirus, people have renewed frightening memories of SARS. Let us tell you that 775 people from 32 countries lost their lives due to SARS which was spread from China.

But as far as Coronavirus is concerned, it is being said that in December 2019, Coronavirus was transmitted from snakes to humans through seafood. At the same time, Coronavirus is spreading rapidly from humans to humans at present. For your information, let us know that apart from China, countries like Hong Kong, Vietnam, Thailand, Singapore, South Korea, Nepal, Japan, France, Australia, USA, and Canada have been hit by Coronavirus. Some suspected Coronavirus patients have also been identified in India returned from China.

While humans are dying of spreading Coronavirus, it is also adversely affecting the Chinese economy. Coronavirus can also bring an economic slowdown to China, which has suffered economic slowdown due to trade war with America. Let you know that in 10 cities of China affected by Coronavirus, public transport has been completely closed. Not only this, but tourist destinations such as Shanghai Disneyland, The Great Wall, and The Forbidden City also been closed.

In the last week, China had banned domestic tourists from visiting these places, after which now international tourists have also been banned from 27 January. Let you know that Coronavirus has attacked in China at the exact time when China is going to celebrate its new year. Millions of Chinese people living abroad come back to China to meet their families while celebrating the New Year in China. It is natural that economic activity is affected in China, which is the world's second-largest economy, and then it affects the economy of the whole world.

For your information, let us know that due to Coronavirus, there will be a tremendous reduction in the number of people traveling from China. This may have the worst impact on the tourism sector in Singapore, Thailand, and Hong Kong. According to the Indian Tourism Ministry, 2,81,768 passengers from China visited India in the year 2018. According to an estimate, a foreign traveler spends around 2 lakh rupees on every trip. In this way, Chinese tourists contribute 76 crore dolor to the Indian economy. But if Chinese tourists do not come to India due to Coronavirus, then it is natural that it will affect India's tourism industry.

Indeed, infectious diseases such as SARS and Coronavirus have adverse effects on the economies of affected countries. Explain that during the SARS attack, Singapore's GDP had to lose 0.5 percent and Hong Kong's GDP 2.5 percent. Similarly, trade between India and China may also be affected due to Coronavirus. Explain that India's exports to China were $ 16.75 billion in FY 2018-19 which was 25.6 percent higher than the previous fiscal. In view of this, India had increased the export target by 4 percent for the financial year 2019-20. But due to the fear that people in Chinese cities stayed indoors for a long time due to Coronavirus, the demand for raw materials from the manufacturing sector would be reduced and this would affect both imports and exports to China.

At the same time, since the outbreak of Coronavirus in China, crude oil prices have come down after a long time. According to experts, the price of crude oil may continue to decline with the spread of Coronavirus. According to estimates, if consumption in China decreases due to Coronavirus, the demand for crude oil will also be reduced in the same proportion. Let us know that the prices of crude oil fell 2.2 percent to $ 60.63 a barrel for the third consecutive week last Friday. This week, its prices have registered a total of 7.6 percent and a decline of about 23 percent for the 12 months from April 2019.

But if the price of crude oil continues to decline due to the spread of Coronavirus in China, India can get the benefit. For your information, let us know that India imports about 80 percent crude oil of its requirement. In such a situation, if the price of crude oil comes down, then inflation will be controlled and the current account deficit will not increase. At the same time, for all these reasons, the Indian currency rupee will strengthen. Since the price of crude oil in the international market is fixed in dollars, India will have to spend fewer rupees to buy oil.

According to experts, a reduction of $ 10 per barrel in crude oil prices will reduce India's current account deficit by about $ 9.2 billion. But let us tell you that India is the sixth-largest country in the world in terms of export of refined petroleum products and this makes India earning about $ 60 billion every year. But due to a decrease in demand and a fall in prices, India may suffer in this area. Naturally, the spread of Coronavirus in the world's second-largest economy, China, could affect the economy of China as well as many countries.