(Image source from: deccanherald.com)

While the entire world is struggling to contain the spread of the deadly coronavirus, India did one of the most impossible things to ever exist. It put 1.3 billion of its population on a lockdown to help contain the spread of the coronavirus. While this step does seem a lot complex, this decision has been praised by people all across the world.

The International Monetary Fund also came forward to support this proactive decision taken by India to further fight Covid-19.

Just a day earlier, IMF has estimated a growth rate of 1.9% for India in the year of 2020.

“India entered the pandemic turmoil in the midst of a credit crunch-induced slowdown and its recovery prospect becomes more uncertain,” said Chang Yong Rhee, the Director of the IMF's Asia and Pacific Department.

Rhee further went on to support the nationwide lockdown situation saying the India decided to opt for the same even when their economic status was not at its best.

While the first lockdown of 21 days was supposed to end on April 14, the same was extended till May 03.

IMF has stated that the impacts of the coronavirus on the Asia-Pacific region are going to be extreme and will likely end up affecting the overall economic growth and stabilities of the countries there.

The same is believed to be worse than that of the annual average growth rates through the Global Financial crisis or even the Asian financial crisis. They further mentioned that Asia has not experienced zero growth in the last 60 years stating that Asia’s growth rate is still a lot better than the other options.

For the coming year of 2021, IMF does believe that there is hope. If the containment policies are followed and things get back to normal, it is likely that there is going to be a rebound in the growth.

But, owing to the situation that prevails, saying anything at this point is too soon.

Rhee believes that since the businesses are experiencing such a drawback at this point, it is extremely important that the Asian countries make use of all the policy instruments present in their toolkits.

IMF believes that the growth rate of China is going to increase by 1.2% by the end of 2020. The revisions to the growth include not just the domestic losses but also the activities induced because of the social distancing measures.

Rhee further stated saying, “We expect a rebound in economic activity later this year. This is because China is emerging from the outbreak first. Nonetheless, there are clear risks: the virus could come back and normalization could take longer.”

On the contrary, the economic status of Japan in 2020 is quite bad at the moment. There is an expected decline in the GDP by 5.2% which is a lot. The coronavirus impact is also going to leave a deterioration in the external demands, affecting the growth of South Korea by 1.2% in the process.

Rhee believes that this is the time to come together as individuals and help each other out. Even though the imposed restrictions and lockdowns have been affecting people’s lives, it is important to support the hardest hit economies and firms.

This pandemic is also impacting the financial marketing functioning.

Addressing the ways to ease the financial stress on industries and SMEs, Rhee said, “We expect a rebound in economic activity later this year. This is because China is emerging from the outbreak first. Nonetheless, there are clear risks: the virus could come back and normalization could take longer."

By Somapika Dutta