Karmvir Kaur Ludhiana India
WHICH CRISIS NEEDS TO BE RESOLVED QUICKER? (MORTALITY RATE OR ECONOMIC SLUMP )
As per textbooks of Business Risk , maximum possibility of business risk is during war . Fighting against COVID19 pandemic is definitely not less than a war , just the difference is that this fight is neither between nations nor between conflicts based on cast, creed, race or religion. The enemy here is an invisible virus that is destroying the global peace badly .
These crisis has caused an adverse effects on economic conditions of the nation by collapsing various economic activities over the last few weeks. Fitch ratings predicts a 5 percentage contraction in the Gross Domestic Product (GDP) for the fiscal year 2020. On the other, it have harmful effects on human life . Within 2 months the death rate of India has reached 1.3(approx) times more than what it was a week ago. No doubt, the recovery rate is 48.88%(approx) but even then watching increasing death rate is scary.
Now , the delimma arises in both sectors of the economy wheather they should #stayhomestaysafe or #gooutandearnforlife .
Now, at Microeconomics level where a household, firm and an industry is in predicament and people are struck between two important choices of wheather to stay home to keep them and their loved ones safe or to go out to cope with their financial crisis . Meanwhile, they are relying on their past savings and are borrowing money to earn their livelihood.
Whereas, At Macroeconomics level economic agents are in problem either they should control the mortality rate first or should cope with declining GDP first.
There are so many people who cannot work from home so , instead of waiting for things to get better, they have to move out and start working while taking precautions. However, if they are unable to take preventive measures, they should stay home . No doubt, risk and uncertainties are everywhere. We are at risk even while crossing the road . We can't eliminate risk but we can reduce it by being more conscious. Similarly, we can't eliminate the risk of Corona Virus but definitely we can reduce it by taking proper precautions. Once, we start doing proper care of ourselves and took proper precautions without any negligence we can definitely kill this invisible enemy and hopefully we will soon subsist the mortality rate as well as economic slump.
- Karmvir Kaur