China News Service Beijing on May 20 (Liu Liang) Statistics show that in the past month, almost all the newly confirmed cases of COVID-19 in India have exceeded 300,000 in a single day. The continuing surge makes India the second country in the world after the United States to have more than 25 million cumulative confirmed cases.
However, the continued deterioration of the epidemic in India has increasingly stalled the global fight against the epidemic, and its potential “spillover effect” has also aroused concerns. Under the general “bullish” tone of the world’s major economies this year, will India, which is caught in the “storm” of the epidemic, affect the overall recovery of the global economy?
Since the beginning of this year, the global economic recovery has been better than expected, with the accelerated introduction of COVID-19 vaccination in major economies around the world and the continuous introduction of government support policies. The economic growth forecast of the world’s major economies has been revised upwards to varying degrees in the second quarter, according to the recent forecast report released by authoritative international institutions.
Qiu Yonghui, chief expert at the Center for China South Asia Studies at Sichuan University, said in an interview with China News Service that the impact of the outbreak on the global economy still needs to be assessed in terms of the duration of the outbreak and the impact on India’s economy and trade.
India is the fifth largest economy in the world, behind the US, China, Japan and Germany, according to the World Bank’s 2019 global GDP rankings. At the same time, India is also a global pharmaceutical power, ranking the third in the pharmaceutical industry, accounting for 3.5% of the total global exports of drugs, and about 20% of the global exports of generic drugs.
In terms of GDP, India’s economy accounts for about 3.2% of the world’s total. Some economists estimate that the impact on the world economy will be minimal. “But if we look at it from another perspective, India’s overall rapid growth over the past few years has even been called the ‘growth engine’ of the world economy. If India becomes the ‘development drag’ of the world economy, it will itself be a heavy blow to the global economy.” Qiu Yonghui said.
She further pointed out that similarly, India accounts for only about 2% of total world trade, foreign trade in theory should be the overall impact of global trade co., LTD., but in reality, because India’s vaccine production capacity is strong, and carry on the order of vaccine and exports to many countries “in the global epidemic of key period, India by ‘world pharmacy into the ward, The impact cannot be assessed in terms of trade alone.”
The Serum Institute of India is reported to be the world’s largest vaccine manufacturer and the largest supplier of COVID-19 vaccine implementation programme led by the World Health Organization. India’s existing capacity of 70 million doses of vaccine per month is a drop in the bucket in the face of an outbreak that is “out of control.” This could affect the amount of vaccine exported, exacerbating a global shortage of vaccine supplies.
What’s more, the rapid spread of the epidemic in India is having an impact on the economy. On the one hand, India’s escalating containment efforts have sent a knock-on blow to the industry. Due to the worsening situation of the epidemic, some countries and regions have imposed stricter prevention regulations on ships and seafarers involved in Indian shipping routes, which has put pressure on many shipping companies to adjust their personnel.
About 15 percent of the 1.6 million seafarers working on ocean-going ships globally are Indian, according to the International Maritime Council. The impact on shipping, which carries about 80 percent of the world’s trade in goods, should not be underestimated.
On the other hand, the worsening epidemic in India has also affected the operations of many multinational companies. Many prominent European and American financial services firms, technology giants and others have their back offices in India and employ millions of Indians. Now, in the face of the spread of the epidemic, these companies are also rushing to support local staff in India to keep the back office running.
In India itself, the economy is no better. While most international agencies maintained their optimistic economic forecasts for India at the start of the year, some agencies have downgraded their GDP growth forecasts for this year in light of the pandemic, citing factors such as the country’s escalating health burden and erratic vaccination rates.
“If the epidemic persists in India and Southeast Asian countries such as Vietnam, Indonesia and Malaysia take over the production chains and distribution channels, India’s economic recovery will be more difficult,” he said. Qiu Yonghui said.
Talking about the reasons for the worsening of the epidemic in India, Qiu Yonghui pointed out that political rallies and religious festivals are the surface causes of the epidemic, while the underlying reasons are the large area of absolute poverty in India, poor comprehensive medical conditions and the lack of organizational and governance capacity of a modern country.
“Unfortunately, these are not things that can be resolved in a short time. So the Indian epidemic is going to go on for a long time, adding risks such as more mutations in the process, and the impact on the global response is going to be long-term, “he said. Qiu Yonghui said.
For now, the epidemic is still spreading in India. Data shows, although India daily new confirmed fell slightly in the past two days, seems to have brought a glimmer of hope for better outbreak, but the world health organization experts quickly poured cold water, warned India outbreak continues to ferment, and because of the virus detection and inadequate capacity, the actual situation may get worse.
