Coronavirus gives an 'initial shock' to the Indian economy
Wednesday - March 4, 2020 11:01 am ,
Category : WTN SPECIAL
Indian rupee gets weaker against US dollar
Coronavirus infects the Indian economy; Investors withdrawing money from the stock market
MARCH 04 (WTN) - As you know, the Coronavirus infection spread from Wuhan city of China has become an epidemic in China. China's economy, the world's second largest economy, has been badly affected by the Coronavirus. According to an estimate, the Chinese economy could suffer about $ 160 billion economic damage due to the Coronavirus. But as far as the economy of India is concerned, due to the Coronavirus, the Indian economy has also started getting its initial setbacks. And if this remains so, there is an apprehension of the adverse impact on the Indian economy in the coming times. After all, why could the Coronavirus have a major impact on the Indian economy? Let us tell you about it in detail.
First of all, for your information, let us know that about 3100 people have died in China due to the Coronavirus so far. At the same time, thousands of people are said to be infected with the Coronavirus. Not only China but also the Coronavirus infection has killed people in other countries of the world. Apart from South Korea, the neighboring country of China, many people have died due to the Coronavirus in European country Italy and in West Asia country Iran so far. As far as China's neighboring country India is concerned, patients infected with the Coronavirus have also been identified in India.
It is natural that the way the Coronavirus has affected the production in China, in the same way, if the Coronavirus in India is affected, it will also have adverse effects on the Indian economy. Indian currency rupee has been steadily weakening against the US dollar since the Coronavirus cases were found in India. The main reason for the Indian rupee depletion is the collapse of the Indian stock market due to the Coronavirus in China. As far as the big domestic and foreign investors of the stock market are concerned, for your information, let us know that these big investors have started investing their money in gold due to the downturn in the stock market due to the Coronavirus.
Now, the big investors are not investing in the stock market due to the effect on the market due to the Coronavirus, the stock market is going to decline. According to experts, in the month of February this year, foreign investors have withdrawn Rs 12,684.30 crore from the Indian stock market. At the same time, in the month of March, foreign investors are investing in gold by withdrawing their money from the stock market. But if the investment in the stock market will be less, and the stock market will decline, it will directly affect the Indian currency rupee. The Indian currency rupee will be weaker than the US dollar due to the fall in the stock market. And when this happens, the problem of the Indian government, as well as the common Indian consumer, will increase.
For your information, let us know that India imports about 80 percent of its crude oil from abroad. Apart from crude oil, India also imports many other important goods from abroad. Now, as you know that foreign trade is mostly in US dollars, in such a situation, India will have to spend more foreign exchange than before in the import of crude oil and other goods. In such a situation, when the oil companies will buy expensive oil from abroad, it is natural that petrol-diesel prices will increase at the domestic level also. Now while diesel will be expensive, it will also make transportation of everyday necessities expensive as transportation becomes expensive.
According to an economic survey, Indian oil companies have an additional burden of Rs 8,000 in crude oil imports due to the depreciation of the Indian rupee against the US dollar. Now if Indian oil companies buy crude oil at an expensive price from the international market, then it is natural that petrol-diesel prices will increase in the domestic market. According to the survey, the 10 percent increase in petroleum product prices may increase inflation by about 0.8 percent.
For your information, let us know that India also imports edible oil and pulses on a large scale. In such a situation, the prices of edible oil and pulses will also increase due to the weakening of the rupee, which will directly affect the monthly budget of the common man. Naturally, the Coronavirus has started to affect the Indian economy as well. Due to the decline in the Chinese economy, the Indian stock market is declining, and as the big investors start withdrawing money from the stock market, the Indian currency rupee will continue to weaken compared to the US currency dollar. And when this happens, the inflation in India will increase even more, due to which the common man can face troubles.
MARCH 04 (WTN) - As you know, the Coronavirus infection spread from Wuhan city of China has become an epidemic in China. China's economy, the world's second largest economy, has been badly affected by the Coronavirus. According to an estimate, the Chinese economy could suffer about $ 160 billion economic damage due to the Coronavirus. But as far as the economy of India is concerned, due to the Coronavirus, the Indian economy has also started getting its initial setbacks. And if this remains so, there is an apprehension of the adverse impact on the Indian economy in the coming times. After all, why could the Coronavirus have a major impact on the Indian economy? Let us tell you about it in detail.
First of all, for your information, let us know that about 3100 people have died in China due to the Coronavirus so far. At the same time, thousands of people are said to be infected with the Coronavirus. Not only China but also the Coronavirus infection has killed people in other countries of the world. Apart from South Korea, the neighboring country of China, many people have died due to the Coronavirus in European country Italy and in West Asia country Iran so far. As far as China's neighboring country India is concerned, patients infected with the Coronavirus have also been identified in India.
It is natural that the way the Coronavirus has affected the production in China, in the same way, if the Coronavirus in India is affected, it will also have adverse effects on the Indian economy. Indian currency rupee has been steadily weakening against the US dollar since the Coronavirus cases were found in India. The main reason for the Indian rupee depletion is the collapse of the Indian stock market due to the Coronavirus in China. As far as the big domestic and foreign investors of the stock market are concerned, for your information, let us know that these big investors have started investing their money in gold due to the downturn in the stock market due to the Coronavirus.
Now, the big investors are not investing in the stock market due to the effect on the market due to the Coronavirus, the stock market is going to decline. According to experts, in the month of February this year, foreign investors have withdrawn Rs 12,684.30 crore from the Indian stock market. At the same time, in the month of March, foreign investors are investing in gold by withdrawing their money from the stock market. But if the investment in the stock market will be less, and the stock market will decline, it will directly affect the Indian currency rupee. The Indian currency rupee will be weaker than the US dollar due to the fall in the stock market. And when this happens, the problem of the Indian government, as well as the common Indian consumer, will increase.
For your information, let us know that India imports about 80 percent of its crude oil from abroad. Apart from crude oil, India also imports many other important goods from abroad. Now, as you know that foreign trade is mostly in US dollars, in such a situation, India will have to spend more foreign exchange than before in the import of crude oil and other goods. In such a situation, when the oil companies will buy expensive oil from abroad, it is natural that petrol-diesel prices will increase at the domestic level also. Now while diesel will be expensive, it will also make transportation of everyday necessities expensive as transportation becomes expensive.
According to an economic survey, Indian oil companies have an additional burden of Rs 8,000 in crude oil imports due to the depreciation of the Indian rupee against the US dollar. Now if Indian oil companies buy crude oil at an expensive price from the international market, then it is natural that petrol-diesel prices will increase in the domestic market. According to the survey, the 10 percent increase in petroleum product prices may increase inflation by about 0.8 percent.
For your information, let us know that India also imports edible oil and pulses on a large scale. In such a situation, the prices of edible oil and pulses will also increase due to the weakening of the rupee, which will directly affect the monthly budget of the common man. Naturally, the Coronavirus has started to affect the Indian economy as well. Due to the decline in the Chinese economy, the Indian stock market is declining, and as the big investors start withdrawing money from the stock market, the Indian currency rupee will continue to weaken compared to the US currency dollar. And when this happens, the inflation in India will increase even more, due to which the common man can face troubles.
