Several months into the conflict, fears over the impact have moderated.
"Following a robust rebound of over 9 per cent in the year ending March 2022 (fiscal 2021), we expect real GDP to grow 8.2 per cent in fiscal 2022, the fastest expansion among G20 countries globally and partly reflecting ongoing base effects from pandemic-led disruptions," it said in a report.
The buoyant economy creates favourable operating conditions for the country's banks, besides their loan performance and profitability are improving, albeit from a low base. Capital and liquidity levels are also stable.
The global economic fallout from the Russia-Ukraine military conflict will push up inflation and interest rates in India, and create supply constraints, it said.
India, as an agricultural economy, is a net food exporter but depends on significant agricultural imports such as palm oil.
"Higher food prices will therefore directly affect inflation, while soaring fuel prices will have an even larger adverse impact. India's Consumer Price Index (CPI) was 6.1 per cent before the conflict and had risen to 7 per cent in March."
Indian banks, however, are in better shape now than before the pandemic. Loan quality had deteriorated over the prior decade as a large proportion of the banks' corporate lending books turned sour. Corporate stress at that time was linked to multiple factors including slowing economic growth, over-indebtedness and poor governance.
Since then, the banks have cleaned their balance sheets and non-performing loans (NPLs) are falling as a result.
"The asset-weighted average of rated banks' gross NPL ratios nearly halved to 5.7 per cent as of December 31, 2021 from a peak of 10.3 per cent at end of March 2018."
The report said it expects the NPLs to decline further as banks make recoveries or write off legacy problem debt, while formation of new NPLs will be stable as the economy recovers.
"Loan growth will also help push NPL ratios down by expanding the overall pool of loans, even though new defaults may arise from loans that have been restructured because of pandemic-related economic disruption."
This year, consumer and business confidence is improving and domestic demand is up.
A decline in loan-loss provisions as NPLs fall and an increase in net interest margins as interest rates rise will boost banks' profitability, while capital, funding and liquidity will be stable and support the overall loan growth, the report further said.
Though the State government introduced online education for students, lack of facilities like mobile phones, internet connection and electricity made the e-learning process elusive for students in rural areas.
Besides, insecure financial condition of parents due to the pandemic impact has been seen as the major causes of children giving schools the miss.
After remaining away from schools during the pandemic, most of the children have either started helping their families in daily chores or engaged in a variety of construction works.
"We have started working in the stone quarry after our school was shut. We earn a little here which helps our families," said a student.
Another student said, "We have nothing to do, so, either we rear cattle or go for bird hunting."
In Koraput district alone, the dropout number is more than 4,200. Swabhiman Anchal in Malkangiri district also has a disturbing trend of students dropping out from schools.
This year, around 30,000 students had passed out from Adarsha Abasika Vidyalays in Odisha. Out of them, around 13000 opted for Plus 2 and other courses while around 17,000 students have reportedly quit study.
As per reports, over 3 lakh students quit schools during the pandemic. Now, the State government has started to identify the students in a bid to bring them back.
“The number of dropout cases, which used to be around 1 lakh, increased to more than 3 lakh during the pandemic. Taking this into account, we hope the State government will make arrangements to open all schools and ensure conduct of regular classes,” said Prakash Mohanty, general secretary of OSTA.
Koraput DEO Ramachandra Nahak said, “We found high dropout rate during door-to-door survey. Our efforts are on to bring the students back to the mainstream."
As per the data available with the Union Rural Development Ministry (MGNREGS), the work demand during June in Odisha had touched a high of over 16.04 lakh households. But the State government could provide jobs to only 15.01 lakh households.
What seems very concerning is, households demanding unskilled jobs under the scheme in June alone had been around 58 per cent of the total of 27.43 lakh households who demanded work under MGNREGS since April this year.
Significantly, the number of households who demanded jobs was only 25.8 lakh in 2019-20, and it was only 23.8 lakh in 2018-19.
The Pandemic Link
Experts see a link between the unprecedented rise in demand for jobs under the rural job scheme and rural employment scenario growing acute. Data also supports the same.
As per the Centre for Monitoring Indian Economy's (CMIE) lockdown data, the unemployment rate in Odisha was around mere 2 per cent (1.9%) in April. However, by May-end, following the enforcement of the lockdown in the State, the unemployment rate had shot up to touch over 7 per cent.
Moreover, a data analysis over the years shows that when in 2018-19 and 2019-20, the households demanding work during Apri- June (summer months) had been in the range of 14-20 lakh, the number grew sharply to 31 lakh during the first wave and to 40 lakh in the second wave.
"Usually, in every summer, the demand for work under the Rural Employment Guarantee Scheme has been higher due to decline in rural employment opportunities. But the comparative data shows that households demanding work during the pandemic period have been ultra-high during the pandemic years. This shows there is a severe crunch in job opportunities in rural areas," explained XIMB Prof Neeraj Kumar.
More Concerning Numbers
In contrast to the projected person-days of over 3.9 crore for the year 2021-22, the actual person-days generated till June end in the State had been a humongous 7.7crore. The actual man-days generated till June had been over 197 per cent of the full projection for the year. The month of June alone had generated over 2.73 cr man-days.
Hotspot Rural Districts
As per the data available, the demand for work under MGNREGA decreased between April - June in only two districts - Ganjam and Mayubhanj. But the number of households demanding jobs under the rural scheme in the industrially developed district Sundargarh rose to over 1.33 lakh in June from 80k in April.
Keonjhar and Bolangir districts had also witnessed a big rise in job demand under the rural household scheme during the second wave. Among the coastal hotspots, households who demanded work in the Khordha district increased to over 24k in June from around 12k in April. Similarly, the number was up at over 51k in Cuttack from 30k in April.
"I proposed to postpone for about a year and President Bach responded with 100 per cent agreement," Abe told reporters referring to Thomas Bach, head of the IOC.
This thus makes it the first Olympics to be postponed with the Games being cancelled previously during the Second World War.
Abe had a telephonic conversation with Bach on Tuesday after which he told reporters that the pair have come to an agreement on the postponement. The IOC has come under increasing pressure from a number of quarters to announce a postponement with restrictions on movement of people being set in countries around the world due to the coronavirus pandemic that has claimed over 16,500 lives as on Tuesday.
Read: Postponing Tokyo Olympics Might Be Unavoidable, Says Japan PM Shinzo Abe
Abe had previously said that a postponement is unavoidable if the 2020 Games cannot be held in a complete manner amid the coronavirus pandemic, according to NHK.
IOC member Dick Pound had stated that the 2020 Summer Games will be postponed by one year because of coronavirus.
The Indian Olympic Association (IOA) has stated that no decision regarding the postponement of Tokyo Games, slated to start from July 24, has been made as of now by the International Olympic Association (IOC) and it will be done only in four weeks' time.
Chairman of the British Olympic Association has said Great Britain would be unlikely to send a team to Tokyo this summer while Australia and Canada had already said they will not compete in Japan due to the coronavirus pandemic this year.
The United States Olympic and Paralympic Committee said that "the path toward postponement" of the Tokyo Games is "most promising" after surveying about 2,000 American athletes.
The US Olympic and Paralympic Committee sent a survey over the weekend to more than 4,000 athletes on the coronavirus pandemic and the Games, and they received responses from 1,780, reports Xinhua news agency.
The Canadian Olympic and Paralympic Committees announced on Sunday that they will not send a delegation of athletes to the Tokyo Games unless they were postponed.
Australia's Olympic Committee also released a similar statement, saying that its athletes should prepare for a Tokyo Olympic Games "in the northern summer of 2021".
Also Read: Coronavirus Effect: French Open Postponed To September 2020
The International Olympic Committee (IOC), International Paralympic Committee (IPC), Tokyo 2020 organising committee, Tokyo metropolitan government and the government of Japan announced on Monday that the Tokyo Olympic Games will be staged from July 23 to August 8, 2021, and the Tokyo Paralympic Games will run from August 24 to September 5, 2021.
"We support the new 2021 dates for the Tokyo 2020 Olympic Games announced today by the Japanese organizers and the IOC (International Olympic Committee). This gives our athletes the time they need to get back into training and competition," the World Athletics said in the statement.
"Everyone needs to be flexible and compromise and to that end we are now working with the organizers of the World Athletics Championships in Oregon on new dates in 2022 for our World Athletics Championships."
Also Read: Coronavirus Impact On Indian Sports & Sportsmen
The new dates for the Tokyo Olympic Games will not allow the 2021 World Championships -- scheduled to be held from August 6 to 15 -- to take place as planned.
"We would like to thank our Oregon 2021 Organizing Committee, their stakeholders and our partners for their collaboration and willingness to explore all options," the World Athletics said.
The World Athletics also said that they are also in discussions with the Commonwealth Games Federation and the European Championships, as both of the events are due to be held in 2022.
(With IANS Inputs)
Read More: COVID-19 Impact: 2020 Tokyo Olympics Postponed, Games To Be Held In 2021
It marks the first time since 1945 -- during the Second World War -- that the Championships won't take place in a tennis season and the first time it has been cancelled in the Open era.
"It is with great regret that the Main Board of the All England Club (AELTC) and the Committee of Management of The Championships have today decided that The Championships 2020 will be cancelled due to public health concerns linked to the coronavirus epidemic. The 134th Championships will instead be staged from 28 June to 11 July 2021," the AELTC said in its statement.
Read: COVID-19 Impact: 2020 Tokyo Olympics Postponed, Games To Be Held In 2021
It also said that it has taken into account the impact of the cancellation on "those who rely on The Championships -– including the players and the tennis community in Britain and around the world," and are developing plans to support those groups. "This also applies to our loyal staff, to whom we take our responsibility very seriously," said the AELTC.
Earlier, it was announced by the French Tennis Federation that the French Open will be held from September 20 to October 4. However, that remains uncertain with a number of players pointing out the difficulty of playing a clay court Grand Slam in the middle of the hard court season and because of the spread of the coronavirus pandemic showing no signs of stemming in most parts of the world.
The Wimbledon thus joins a long list of major sports events that have been cancelled or postponed due to the pandemic which includes the 2020 Tokyo Olympics which will now be held from July 23 to August 8, 2021. The pandemic has claimed nearly 45,000 lives in the world so far and the UK has reported almost 30,000 cases as on April 1.
Also Read: COVID-19 Impact: World Athletics To Postpone 2021 World Championships To 2022
The RSP, a unit public sector steel behemoth SAIL, also seeks to produce 3.9 MT of crude steel and 3.55 MT of saleable steel.
"For the financial year 2020-21, we have taken up the production targets of 4.1 MT hot metal, 3.9 MT of crude steel and 3.55 MT of saleable steel, RSPs CEO DipakChattaraj said on Wednesday.
Also Read: Rourkela Steel Plant Registers Record Production In Feb
The goals are tough, but so are we. We have to make every possible effort to protect our pride and dignity. Let's strive to have an Unnattara and Utkrushttara Plant, he said in a message on the commencement of the new fiscal and UtkalDibas, Odishas formation day.
Referring to the coronavirus outbreak, he said this year is going to be very different from the ones before.
It seems that the severe impact of COVID-19 (coronavirus) on the economy is going to cause a paradigm shift in the behaviour of the market, the CEO said.
Stating that a high-level task force is monitoring the COVID-19 situation, he said that intensive sanitization and cleaning operations are continuing both inside the plant and in the township, while a massive awareness campaign has been launched using every medium possible.
"We are rationalising production depending on the situation and deploying minimum manpower accordingly, the RSP CEO said.
To strike an effective balance between the need for social distancing and requirements of the Plant, at any particular point of time, we are allowing 40 to 60 per cent employees of various units to work from home, he said.
Describing 2019-20 as the year of consolidation and resolution, Chattaraj said that external factors like the global slowdown in the steel market and fluctuating prices combined with internal issues like escalating cost of production, huge inventory and high debt burden kept our bottom line stressed.
With a special focus on sustainability and long term growth, RSP managed to resolve some long pending issues whose immediate liquidation was critical for the survival of the organization, he said.
These could no longer be delayed. While we were aware that these issues required long shutdowns which would result in production loss, we took it as a challenge and went on to complete them within the schedule for sustainable production and environment management, he said.
Some of these projects that will have long term impact on the sustainability of the Plant are installation of Doghouses in two old convertors of SMS-2, erection of waste gas cleaning systems in Kiln-2,3 & 4 of calcining plant-2 and relining of blast furnace-4 which was planned in 2017.
Now the furnace is getting ready for operation, the CEO said.
Also Read: Rourkela Steel Plant To Be Expanded: Union Minister Dharmendra Pradhan
Despite many odds RSP set many new benchmarks in the last fiscal as its blast furnace-5 crossed 15 MT production mark in February and the last 1 MT was made in only 132 days, Chattaraj said.
All-time best hot metal production was clocked with 2 furnace operation, he said.
Our three main mills, namely plate mill, new plate mill and hot strip mill have all registered their all-time best annual performance with combined production of 3.1 MT, Chattaraj added.
(PTI)
The UN-DESA briefing finds that millions of workers are at risk of losing their jobs as nearly 100 countries close their national borders. That could translate to a global economic contraction of 0.9 per cent by the end of 2020, or even higher if governments fail to provide income support and help boost consumer spending, Xinhua reported citing the UN-DESA study.
According to the forecast, lockdowns in Europe and North America are hitting the service sector hard, particularly industries that involve physical interactions such as retail trade, leisure and hospitality, recreation and transportation services. Collectively, such industries account for more than a quarter of all jobs in these economies.
As businesses lose revenue, unemployment is likely to increase sharply, transforming a supply-side shock to a wider demand-side shock for the economy. The severity of the impact will largely depend on the duration of restrictions on the movement of people and economic activities and on the scale and efficacy of responses by national treasuries.
Against that backdrop, the UN-DESA is joining a chorus of voices across the UN system calling for well-designed fiscal stimulus packages which prioritize health spending and support households most affected by the pandemic.
Also Read: COVID-19: RBI Offers More Sops To Ease Compliance Burden
"Urgent and bold policy measures are needed, not only to contain the pandemic and save lives, but also to protect the most vulnerable in our societies from economic ruin and to sustain economic growth and financial stability," said Liu Zhenmin, UN undersecretary-general for economic and social affairs.
The Acuite Ratings & Research, in its latest report, has said that the ongoing disruption caused by the spread of Covid-19 will have a significant economic consequence with estimates suggesting that every single day of the 21-day nationwide lockdown will cost the Indian economy almost $4.64 billion.
The single-day loss number will translate into a GDP loss of almost $98 billion during 21-day lockdown, the credit rating agency said.
"We have employed multiple methods to assess real GDP estimates for Q1 of FY21 and believe that there is a significant risk that it may contract up to 5%-6% as compared with a pre-Covid growth estimate of 5%," Sankar Chakraborti, CEO, Acuite Ratings & Research, said.
In such a lockdown scenario, the most severely impacted sectors are transport, hotel, restaurant and real estate activities. According to Acuite, there would be around 50% GVA (gross value added) loss in these sectors, which account for around 22% in overall GVA, in Q1 of FY21.
On the other hand, services expected to see enhanced activities during this crisis are communication, broadcasting and healthcare; however, at 3.5%, these sectors have a small contribution in the overall GVA.
The impact of the lockdown is also fairly severe on industrial activities, which are set to witness significant contraction in Q1 except in the pharmaceutical, gas and electricity and medical devices which account for around 5% of GVA.
Unlike the services sector, the industry, however, can manage demand to some extent with inventory drawdowns until the resumption of production.
Karan Mehrishi, Lead Economist of the rating agency, said: "The agricultural sector, which accounts for 15% of GVA, is nonetheless, expected to see continuing activity even in the lockdown period; however, the allied activities are partly impacted as livestock and fisheries are experiencing mute demand due to the Covid-19 concerns."
Acuite said it would take at least 2-3 months to restore the industry supply chain even if the lockdown is limited to 21 days; there are also further risks of local lockdown in different regions in India, depending on the extent of the outbreak and partial disruption in economic activities till H1FY19 is a realistic scenario.
It is estimated that the second quarter may show a moderately positive growth of just under 3% on the back of the expected normalization process and some pent-up demand although it is also linked to the intensity of the pandemic.
Also Read: Coronavirus: BSNL Announces Free Offers, Jio-Vodafone-Airtel Introduce New Plans
On the positive side, a quick recovery in the domestic economic activities is likely in H2, which may in turn benefit from the increased fiscal and monetary measures along with lower global oil prices.
"We, therefore, believe that the average H2 GDP expansion may be in the vicinity of 6.5%. Overall, a likely contraction in Q1 followed by a modest growth in Q2 will clearly have a severe impact on India's economic trajectory that has already been under the effect of a prolonged slowdown," the report said.
(IANS)
To lessen the COVID-19 impact and mitigate the crisis and chaos situation, Finance Minister Nirmala Sitharaman had on March 26, announced a package of 1.70 lakh crore to help PF account holders facing economic crisis during Covid-19.
Meanwhile, this led to a rise in the withdrawal of money from the PF accounts. According to the Employees Provident Fund Organisation (EPFO) of the Ministry of Labour, about 13 lakh account holders have availed this facility so far as Rs 4,684.52 crore has already been paid on claims.
According to the Ministry of Labour and Employment, the number of withdrawals from exempted PF trusts has also increased. According to the data on April 27, a total of 79,743 exempted PF trust account holders withdrew Rs 875.52 crore from the accounts.
Moreover, 54,641 account holders of 222 private establishments withdrew Rs 338.23 crore, while 24,178 beneficiaries of 76 public sector establishments withdrew Rs 524.75 crore from their accounts, reported a news agency.
However, soon after the report, Congress slammed the government for writing off loans. Congress chief spokesperson Randeep Surjewala charged the BJP with helping the defaulters and said, "Till April 24, Rs 68,607 crore have been written off by the government. The Prime Minister cannot evade this question by keeping silent."
"As much as Rs 8,048 crore have been written off of Mahul Choksi and Nirav Modi. Another diamond merchant Jatin Mehta's Rs 6,048 crore too have been written off, and so is the case with Kingfisher's Vijay Mallya. Similar is the case with the relations of these defaulters," said Surjewala.
Targeting the government on freezing the Dearness Allowance (DA), the Congress said such write-offs have come to light at a time when DA of the Central government employees and the Army personnel has been freezed citing COVID-19 impact.
The party further alleged that in the last five and a half years, the government had written off Rs 5.10 lakh crore of the default money till September 2019.
However, the ruling-BJP later clarified that there is no cut in DA and dearness relief (DR), and the additional hike over 17% currently paid will be reinstated prospectively, effective Jan 2020.
“There is no cut in DA and DR. It’s a temporary HOLD on the additional HIKE, which will be reinstated. DA and DR at the current rate, the highest ever rate at 17% brought by the Modi government, will continue to be paid,” the ruling-BJP said in a tweet.
“When the government decides to release the instalments of DA and DR from 1 July 2021, the effective rates from January 2020, July 2020 and January 2021 will be restored prospectively and will be subsumed in the cumulative revised rate effective from 1 July 2021,” the party added.
Making the announcement on the basis of an assessment of the current and evolving macroeconomic situation by the Monetary Policy Committee (MPC) at its meeting today, RBI Governor Shaktikanta Das said the reverse repo rate has been reduced to 3.35 per cent from 3.75 per cent.
The repo rate cut by 40 basis points from 4.4 % to 4%. Reverse repo rate stands reduced to 3.35%: Reserve Bank of India (RBI) Governor Shaktikanta Das pic.twitter.com/bjxWjWX9Gj
— OTV (@otvnews) May 22, 2020
Global rate inexorably headed to recession. Interest rate reduced by 40 basis points. The rate is down from 4.4% to 4%: RBI Governor Shaktikanta Das pic.twitter.com/bsA3iGQrRE
— OTV (@otvnews) May 22, 2020
The MPC also decided to continue with the accommodative stance as long as it is necessary to revive growth and mitigate the impact of COVID-19 on the economy, while ensuring that inflation remains within the target.
These decisions are in consonance with the objective of achieving the medium-term target for consumer price index (CPI) inflation of 4 per cent within a band of +/- 2 per cent, while supporting growth.
RBI Governor Shaktikanta Das today said domestic economic activity has been impacted severely by the lockdown which has extended over the past two months. High frequency indicators point to a collapse in demand beginning March 2020 across both urban and rural segments. Electricity consumption has plunged, while both investment activity and private consumption suffered precipitous declines, as reflected in the collapse in capital goods production and the large retrenchment in the output of consumer durables and non-durables in March.
High frequency indicators of service sector activity such as passenger and commercial vehicle sales, domestic air passenger traffic and foreign tourist arrivals also experienced sizable contractions in March. The only silver lining was provided by agriculture, with the summer sowing of rice, pulses and oilseeds in the country progressing well, with total area sown under the current kharif season up by 43.5 per cent so far, and the rabi harvest promising to be a bumper as reflected in record procurement, the RBI Governor said in his briefing.
Reverse repo rate down, at 3.5%. Domestic demand has collapsed, economic activity severely affected due to 2-month lockdown. Industrial production shrank by close to 17% in March with manufacturing activity down by 21%. Output of core industries contracted by 6.5%: RBI Governor pic.twitter.com/XFs1xX9hTh
— OTV (@otvnews) May 22, 2020
Headline inflation may remain firm and ease in second half of the year. It is expected to fall in Q3 and Q4 below target of 4%
India seeing collapse of demand; electricity, dip in petroleum product consumption; fall in private consumption
-- RBI Governor Shaktikanta Das pic.twitter.com/zu8aBU3lMF
— OTV (@otvnews) May 22, 2020
Agricultural sector has offered a ray of hope. It is because of the forecast of normal monsoon: RBI Governor Shaktikanta Das
— OTV (@otvnews) May 22, 2020
Retail inflation, measured by the consumer price index, moderated for the second consecutive month in March 2020 to 5.8 per cent after peaking in January. This was mainly due to food inflation easing from double digits in December 2019 – January 2020.
In April, however, supply disruptions took a toll and reversed the softening of food inflation, which surged to 8.6 per cent from 7.8 per cent in March. Prices of vegetables, cereals, milk, pulses and edible oils and sugar emerged as pressure points1.
The Reserve Bank remained in pro-active liquidity management mode, expanding its array of measures, both conventional and unconventional, to augment system-level liquidity as also to channel liquidity to specific sectors facing funding constraints. Systemic liquidity remained in abundance, with average daily net absorptions under the liquidity adjustment facility (LAF) increasing to ₹5.66 lakh crore in May 2020 (up to May 20) from ₹4.75 lakh crore in April. During 2020-21 (up to May 20), ₹1,20,474 crore was injected through open market operation (OMO) purchases and ₹87,891 crore through three targeted long-term repo operation (TLTRO) auctions and one TLTRO 2.0 auction.
In order to distribute liquidity more evenly across the yield curve, the Reserve Bank conducted one ‘operation twist’ auction involving the simultaneous sale and purchase of government securities for ₹10,000 crore each on April 27, 2020.
Furthermore, the Reserve Bank has provided ₹22,334 crore as refinance to National Bank for Agriculture and Rural Development (NABARD), Small Industries Development Bank of India (SIDBI) and National Housing Bank (NHB) so far (as on May 21, 2020) and ₹2,430 crore to mutual funds through a special liquidity facility (SLF) with a view to easing liquidity constraints and de-stress financial markets. Since February 6, 2020 the Reserve Bank has announced liquidity augmenting measures of ₹9.42 lakh crore (4.6 per cent of GDP).
RBI increases maximum period of pre and post shipment credit period to 15 months from 1 year. It will roll over Rs 15,000-crore refinance facility for SIDBI for 90 days and 15,000-crore line of credit to EXIM Bank
--Reserve Bank of India (RBI) Governor Shaktikanta Das pic.twitter.com/yG9A5tgDvd
— OTV (@otvnews) May 22, 2020
In the external sector, India’s merchandise trade slumped in April 2020, with exports shrinking by 60.3 per cent and imports by 58.6 per cent (y-o-y), respectively. While imports contracted in all 30 commodity groups in April, exports contracted in 28 out of 30 groups. The trade deficit narrowed in April 2020 – both sequentially and on a year-on-year basis – to its lowest level in 47 months.
On the financing side, net foreign direct investment inflows picked up in March 2020 to US$ 2.9 billion from US$ 0.8 billion a year ago. In 2020-21 so far (till May 18), net foreign portfolio investment (FPI) in equities increased to US$ 1.2 billion from US$ 0.8 billion a year ago. In the debt segment, however, there were portfolio outflows of US$ 3.8 billion during the same period as compared with outflows of US$ 1.4 billion a year ago.
By contrast, net investment under the voluntary retention route increased by US$ 0.7 billion during the same period. India’s foreign exchange reserves have increased by US$ 9.2 billion in 2020-21 so far (up to May 15) to US$ 487.0 billion – equivalent to 12 months of imports.
The Reserve Bank said that the inflation outlook is highly uncertain. As supply lines get restored in the coming months with gradual relaxations in the lockdown, the unusual spike in food inflation in April is expected to moderate. The forecast of a normal monsoon also portends well for food inflation. Given the current global demand-supply balance, international crude oil prices are likely to remain low although they may firm up from the recent depressed levels. Soft global prices of metals and other industrial raw materials are likely to keep input costs low for domestic firms. Deficient demand may hold down pressures on core inflation (excluding food and fuel), although persisting supply dislocations impart uncertainty to the near term outlook. However, volatility in financial markets could have a bearing on inflation. These factors, combined with favourable base effects, are expected to take effect and pull down headline inflation below target in Q3 and Q4 of 2020-21.
Turning to the growth outlook, economic activity other than agriculture is likely to remain depressed in Q1:2020-21 in view of the extended lockdown. Even though the lockdown may be lifted by end-May with some restrictions, economic activity even in Q2 may remain subdued due to social distancing measures and the temporary shortage of labour.
Recovery in economic activity is expected to begin in Q3 and gain momentum in Q4 as supply lines are gradually restored to normalcy and demand gradually revives. For the year as a whole, there is still heightened uncertainty about the duration of the pandemic and how long social distancing measures are likely to remain in place and consequently, downside risks to domestic growth remain significant. On the other hand, upside impulses could be unleashed if the pandemic is contained, and social distancing measures are phased out faster.
The MPC is of the view that the macroeconomic impact of the pandemic is turning out to be more severe than initially anticipated, and various sectors of the economy are experiencing acute stress. The impact of the shock has been compounded by the interaction of supply disruptions and demand compression. Beyond the destruction of economic and financial activity, livelihood and health are severely affected. Even as various measures initiated by the Government and the Reserve Bank work to mitigate the adverse impact of the pandemic on the economy, it is necessary to ease financial conditions further. This will facilitate the flow of funds at affordable rates and revive animal spirits. With the inflation outlook remaining benign as lockdown-related supply disruptions are mended, the policy space to address growth concerns needs to be used now rather than later to support the economy, even while maintaining headroom to back up the revival of activity when it takes hold.
Accordingly, all members voted for a reduction in the policy repo rate and maintaining the accommodative stance as long as it is necessary to revive growth and mitigate the impact of COVID-19 on the economy, while ensuring that inflation remains within the target.
Since the MPC met in March 2020, global economic activity has remained in standstill under COVID-19 related lockdowns and social distancing. Among the key advanced economies (AEs), economic activity contracted in the US, Euro area, Japan and the UK in Q1:2020. Among emerging market economies (EMEs), the Chinese economy went into a pronounced decline and data on high frequency indicators suggest that activity may have also shrunk in other EMEs such as Brazil and South Africa.
Global financial markets calmed after a turbulent period in March, and volatility ebbed as swift and large fiscal and monetary policy responses helped to soothe sentiment. Equity markets recovered some lost ground, while government bond yields remained range-bound, although somewhat elevated in some EMEs due to country-specific factors. Portfolio flows to EMEs revived in April and the rush to safe havens eased. With the US dollar weakening, major EME currencies, which had experienced persistent downward pressure, traded with an appreciating bias. Crude oil prices firmed up modestly as oil producing countries (OPEC plus) agreed to cut production, and prospects for revival in demand improved on expectations of imminent easing of lockdowns. Gold prices remained elevated on hedging demand. CPI inflation remained subdued across major AEs and EMEs primarily due to a collapse in oil prices and compression in demand amidst lockdowns, while food inflation picked up due to supply disruptions.
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According to experts, nervousness, fear of contamination, panic attacks, constant reassurance-seeking behaviour, sleep disturbance, excessive worry, feelings of helplessness and probability of an economic slowdown are the major factors leading to depression and anxiety among the people.
Potential job losses, financial burden, uncertainty about the future and fears of running out of food and necessities add to the worries.
Online platforms also have seen a growing number of people seeking help for mental health issues, ranging from anxiety and loneliness to concerns over productivity and job loss since the outbreak of COVID-19.
Director of Institute of Mental Health here, Dr R Purna Chandrika said towards April end about 3,632 calls were received and psychiatric counselling was provided to 2,603 callers.
"We have dedicated services at our centres in the districts and the calls meant for government medical college hospitals are routed to the respective institutions," she said.
Due to heavy virus caseloads, making this city the major contributor to the state's tally, the Greater Chennai Corporation too started a free helpline to help residents cope up with stress during the pandemic.
"From a psychological perspective, we don't find a single human being who is not feeling some degree of stress or anxiety due to coronavirus. The intensity and impact vary from person to person," said Lt Col N T Rajan, director of Chennai-based Mastermind Foundation.
The organisation is involved in free counselling throughout India ever since the first case of the deadly virus was reported in the country.
The foundation's recommendation on not to deploy the vulnerable in the police force, especially those above 50 years and women personnel with children below five years for COVID-19 related duty, was accepted and implemented by the Punjab government.
Psychiatrists feel that further worsening situations could lead to severe mental health issues, even triggering suicidal tendencies.
"Further worsening depression may lead to severe mental health issues and suicidal tendencies," said Dr S Senthil Kumar, a psychiatrist.
However, not all of them require medicines, he added.
"The situation is serious. There should be counselling at three stages--on coping with the virus, how to face it if tested positive and how to face life once treated and discharged from the hospital," Rajan said.
Awareness was of paramount importance, he said and warned the pandemic could cause panic attacks while in the hospital or drive them to the brink of suicide.
Tamil Nadu, one of the worst affected states with a virus count in excess of 74,000 as of Friday, has witnessed a few instances of suicides allegedly related to COVID-19.
Hari Singh, the owner of popular 'Iruttu Kadai' halwa shop in Tirunelveli, allegedly died by committing suicide on Thursday after being tested positive for COVID-19. He was 80.
Earlier in May, two COVID-19 patients in their 50s allegedly committed suicide in separate instances, at the government hospitals they were admitted to for treatment.
In the city corporation limits, a three-member team comprising a psychiatrist, counsellor and a social worker work for the respective zones.
"We direct certain sections of people like those with withdrawal symptoms and people requiring pills, to visit the doctor at their corporation zonal at a specific time, for medicines," a health worker of the civic body said.
Health platform, Lybrate reported an increase of 180 per cent in online patient consultations related to mental health on its platform between March 1 and June 20 across the country.
The largest increase came from Mumbai and Delhi, followed by Pune, Ahmedabad, Chennai and Bengaluru.
The biggest jump was witnessed in the age group of 25 and 45 years.
(PTI)
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Vegetables have seen a steep rise in prices in the last couple of months with consumers expressing concerns and alleging that the lockdown has led to monopoly-pricing in retail markets across the State.
However, small retailers claimed that shortfall in demand for vegetables along with lower production amid COVID-19 has made the markets more vulnerable to price volatility.
"Prices of tomatoes and potatoes have risen sharply in the last couple of days. It's getting difficult to manage with the continuous increase in prices," said a consumer.
Another consumer alleged, "A day before the weekend shutdown (on Fridays), the retailers are increasing prices of each and every commodity manyfold. Left with no other option, we have to buy."
"We are dependent on other states for most of the items and vegetable and had suffered losses due to a sudden plunge in demand. It's difficult to comment on the issue," said Debendra Nath Sahoo, secretary of Chhatra Bazaar Traders' Association.
Secretary of All Odisha Traders' Association, Sudhakar Panda, however, said that prices of vegetable are a bit high as there is less supply in the market. "Sale of most of the essential household commodities like sugar, oil, rice, dal have also been badly affected due to the pandemic," he said.
On the other hand, wholesale markets in Odisha have reportedly witnessed a 50 per cent slump in trade in the last couple of months.
"As most of the hotels and hostels are closed and restrictions have been clamped on marriages, our sale has been adversely affected," said a wholesaler.
(Edited By Bikram Keshari Jena)
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In a statement, the Confederation of All India Traders (CAIT) said that the traders across the country are highly depressed because of very minimal footfall of the consumers, considerable absence of employees, facing the highest financial crunch and yet have to meet several financial obligations.
"No support policy from the Central or state government is yet another crucial factor which is haunting the retail trade," it said.
Praveen Khandelwal, Secretary-General of CAIT on Sunday said that the domestic trade in the country is passing through its worst period in the current century which reflects that if immediate steps are not taken, about 20 per cent of the shops in India will have to close down their shutters.
As per inputs available from the traders across the country, CAIT said that there is a footfall of only 10 per cent of the consumers so far post the unlock period which has affected greatly to the daily turnover of the traders.
As per the traders' body, at this crucial time, handholding of traders is all the more much required.
A financial mechanism needs to be crafted to award business loans to traders and relaxation in payment of taxes and extension in repayment period of bank loans, EMIs without any further interest or penalty is also required and several other steps need to be taken to provide financial liquidity at the hands of the traders to revive business activities.
(IANS)
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"Though the Yuvika programme was scheduled to be held from May 11-22 for school students of Classes 8-9, we deferred by six months due to the coronavirus spread since mid-March. With the pandemic continuing, we have decided to cancel it for this year," the official told IANS here.
Launched with much fanfare in 2019 to instill scientific temper and impart knowledge about the country's space applications and technologies to the young students, the 12-day programme involves visit by about 100 selected students to ISRO's four operational centres across the country for exposure.
Three students from each state in the country are selected for the programme and are taken to Vikram Sarabhai space centre in Thiruvananthapuram (Kerala), U.R. Rao satellite centre in Bengaluru (Karnataka), Space Applications centre in Ahmedabad (Gujarat) and the North Eastern space centre at Shillong in Meghalaya on familiarization trip and interaction with the space scientists.
"Of the 368 eligible students, 113 were shortlisted for the programme in March before the national lockdown was enforced on March 25 and extended. Due to uncertainty over the continuation of the pandemic, the trip has been cancelled," said the official.
As part of its outreach programme, ISRO had set up space technology cells, incubation centres and regional academic centres for educating the students in space science.
According to ISRO chairman K. Sivan, the Yuva Vigyani Karyakram (Yuvika) has been pioneered to inspire young minds for taking up space science as a career subject and become space scientists.
"Science and technology are essential for the development of any country and play a major role in improving the quality of life, besides our safety and security," said Sivan told the first batch of Yuvika students in May 2019.
(IANS)
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Disney Parks chairman Josh D'Amaro wrote a letter to employees, saying that this was "the only feasible option we have" due to the Covid-19 pandemic forcing the parks to limit capacity and the ongoing closure of Disneyland in Anaheim, California, reports variety.com.
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He added in another statement that the state of California's "unwillingness to lift restrictions that would allow Disneyland to reopen" worsened the situation.
Disneyland has remained shut since mid-March. Walt Disney World in Orlando, which also closed in March, reopened in mid-July with safety measures as well as reduced visitor capacity.
In the letter to workers, D'Amaro said that the company would meet with affected salaried and non-union hourly employees over the next few days and will begin discussing next steps with the unions that represent those theme park workers.
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About 67 per cent of the cuts will impact part-time workers, affect Disney staff across executive, salaried and hourly positions.
(IANS)