how much money is lost during covid-19

On an estimate, India produces Gross Domestic Product of about Rs. 210 lakh crores and may lose about 7-8% of its GDP to this pandemic. On an average 8-9% of GDP is produced every month and with the 40 days lockdown, India might end up losing about 8% of its total GDP, which would be around Rs. 16 lakh crores. If you listen to the experts, it is said that if the curbs would be stretched beyond 10 weeks, the economy might be in danger of collapsing.

If you take into account the contribution of different sectors of the economy, considering the lockdown, about 60-70% production of GDP in the economy is getting lost due to this whole situation. Also, about 10,000 workers working in manufacturing, construction, mining, service sector might end up losing their jobs. Now to compensate these workers, the government will provide at least Rs. 2000 per month to each one of them for three months, this will cost government Rs. 20,000 crore a month and about Rs. 60,000 crore for three months. This is definitely a huge sum for an economy that is collapsing.

Besides this, there shall be losses in the industries. Some might have the production that is lying in their godowns, which might get rotten with time and remain of no use. There are chances that even if the lockdown ends, there would be no demand in the market as cash outflow would be limited.

Now, if you consider the world economy, the situation is worst, you cannot really put a number to the loss caused by this pandemic to the global economy. Every other country in the world is following strict norms of isolation due to which production has halted. Also, this isn’t going to end here, soon after the lockdown ends, the tourism sector of most countries would be under depression.

India’s tourism sector contributes about 9% of the total GDP, which in any case is not inconsiderate. So, frankly, it is better not to make assumptions yet, as none of us know until when this whole situation is going to continue.