How coronavirus COVID-19 pandemic will affect the global economy

The coronavirus COVID-19 pandemic is not dangerous only for human lives as it has badly affected the global economy too and there is no country in the world which has not been affected by the coronavirus outbreak.

Prime Minister Narendra Modi had also given the 'Jaan Bhi Jahaan Bhi' call few days ago sending a clear message that the government was concerned about protecting both the human lives as well as the country's economy. 

There is a good news and a bad news for Indian economy amid the coronavirus pandemic. The good news is that despite the massive setback due to coronavirus lockdown, India is one among the two countries in the world whose economy is expected to grow more than the world's average. The second country is China. 

But the bad news is that the Indian economy is projected to register only 1.9% growth in 2020 fiscal year, as per the latest report of International Monetary Fund (IMF). This is lowest growth for India since the 1991 balance of payments (BoP) crisis and against its 5.8 per cent forecast earlier. According to IMF, China's economy is expected to record 1.2% growth during the same period, which means that despite 'spreading' the coronavirus across the world, China is going to record economic growth.

The IMF report said that the global GDP will shrink to -3.0% during 2020, while it was projected to remain at 3.3% before the coronavirus outbreak. The loss of 6.3% of GDP means that the global economy will suffer a huge loss of Rs 390 lakh crore this year.

Most countries, in the advanced economy group, are forecast to contract this year, including the United States (-5.9%), Japan (-5.2%), the United Kingdom (-6.5%), Germany (-7.0%), France (-7.2%), Italy (-9.1%), and Spain (-8.0%), the IMF report said. Notably, all these countries have been badly affected by the coronavirus outbreak.

The IMF has also said in its World Economic Report that if the coronavirus pandemic will end in 2020 then the economies of India and other countries will return on track once again.

For 2021, India's growth rate is projected at 7.4 per cent, while that of China at 9.2 per cent. The United States has been projected to grow at 4.5 per cent and Japan 3 per cent, the IMF report said.

The IMF also said in its reportr that global economy has hit the worst recession since the Great Depression in the 1930s due to the raging coronavirus pandemic that has nearly stalled all economic activities across the world. The Great Depression was the worst worldwide economic downturn that lasted for 10 years from 1929, beginning in the US when the New York Stock Exchange on Wall Street crashed and wiped out millions of investors.