Few thoughts on aspects of economy in a situation of global pandemic

        Prof. Amey Tawde
      Faculty, IndSearch
      8th May 2020

Covid 19 has not just infected patients but the entire world economy at large. So much so that just thinking about what can be the scenario in the near future made the German finance minster commit  suicide. This defines the gravity of the situation even after keeping in mind that Germany is most economically and politically stable country of Europe particularly after Brexit incident.

As the paramedical staff is working on the frontline to save lives, This pandemic has taken economic experts across the world back to their drawing boards  for discussing and designing strategies to kick start this near halted economic engine. 

Now to start an engine one can make use of two techniques, cold start and warm start technique. If a car is standing still for a longer period of time there are high chances of battery getting discharged. So one needs to first charge the battery which takes some time and energy and then start the car(Cold start).  If the car standing still but for comparatively less period, energy loss from the battery is not much and hence one can start the car with less effort (Warm Start).  But in either cases if you want to start the car immediately  provided all other parameters are ok then pushing it with some effort stands as the most feasible option.

You can compare this situation with current economic crisis which is staring at India. Like the car which is standing still, Economy is almost halted because of the lock down.  Now you need to start this car anyway, you can charge the battery (Which may take some time and effort) or you can push the car to get that immediate crank.

 Looking at the current situation, what the world needs urgently is health care where pharma sector plays an important role. It is one of India’s strongest sector. Boosting up the pharma sector with different policy intervention by the government provides an opportunity to come up good health care solutions (Pushing the Car).  Improve the health of the masses which can then act as charged battery to help start the car and then as a fuel to run it further (cold start). This will generate more employment opportunity with lesser effort as pharma is already one of the strong sector and we don’t need to invent the wheel all over again.

It has been observed that the pandemic has changed the lifestyle and preferences of the people. They are becoming more health conscious. There is more and more demand for health care products.  This has a huge potential for innovation which provides opportunities for professionals, academicians and students as well. There are many other sectors where in India is doing well like IT, Automotive, Iron and steel etc.  but most of them have external dependencies and economies abroad  have a massive ripple effect on these sectors.  On the other hand pharma is one sector in India currently which is safeguarded from external dependencies. Rather external situations demand much more from Indian Pharma sector.  Recently, by exporting medicines  and other medical stuff to pandemic effected nations, India has upheld its image of ‘Vasudhaiva Kutumbakam’ by acting as an eldest and responsible ‘Kutumb Pramukh’.  This health care diplomacy can help India in securing a good chunk of foreign investment by maintaining humble relations with the world at large which is the need of the hour for reviving Indian economy (Warm start)

Even though  there lies certain challenges like addressing the domestic demand, lack of  environment for research and infrastructure. Rather these challenges are not new  but still pharma has emerged as a important arm of Indian economy.  Also,  to be very optimistic, challenges makes way of solutions which are in itself  unique and innovative. The recent example on this line is when India converted its railway coaches into hospitals where countries around the world were investing in crores in bulding hospitals to fight this pandemic. Hence with bundle of challenges,  if managed properly, Covid 19 can  defiantly  be boon for Indian Pharma sector for sure.