Lock Down in India: After 4 Phases of Lockdown, ‘Unlock’ begins; Impact on Economy, Pros & Cons, Global Impact

close

Updated on June 13, 2020 

 

India has remained under lockdown 4.0 until May 31 with some relaxations. Prime Minister Narendra Modi announced a relief package of Rs.20 lakh crores for various sectors to propel economic growth on May 17. Some relaxations which were provided to Red, Orange and Green zone areas during the Lockdown 3.0 like opening of some of the stand alone shops of non essential items were extended to Medium and small scale industrial sector, farm and trading sector. Malls, Cinemas, restaurants and places with probable high foot fall remained closed. India now is ranked fourth in the world in terms of coronavirus cases, after the US, Brazil and Russia.

 

With the Lockdown 4.0 over, Lockdown-5 with Unlock process of economy has started, offering more relaxations, despite the fact that number of Corona cases continued to rise. Road, rail and air travel is proposed to start with various restrictions, market permitted to open, malls, cinema halls, restaurants are also allowed to open but schools, colleges remain shut. This article explains latest Covid 19 developments in India and the World. Read this article till the end to understand how to discuss Pros and Cons of Lockdown in India in a Group Discussion (GD).

 

Entire country remained under lockdown till May 31, 2020 followed by Unlock-down phase-1 from June 1 and June 14. Upto May 31, was the Lockdown 4.0. Earlier the Lockdown 3.0 was upto May 17, Lockdown 2.0 was upto May 3 and before that the Lockdown 1.0 was from March 22 to April 16, 2020. Prime Minister Narendra Modi announced measures with some relaxations.  According to experts, this is being done to ensure that the Food Safety of India is protected as Rabi harvesting season is on anvil. PM Modi said detailed guidelines have kept in mind the needs of the informal sector and farmers. India now joins countries such as France, USA which are moving with the idea of unlockdown phases after extended lockdown.

 

The announcement comes in the wake of rising Covid 19 cases in India. As of June 13, there were more than 310,000 confirmed cases of Covid-19, out of which 155,000 have recovered. The pandemic has caused more than 9000 deaths. PM said that States have also asked for the extension of the lockdown and some have already extended it . Odisha, Telangana, Maharashtra, Punjab, Uttar Pradesh have already extended the lockdown with some relaxations to give stimulus to economic growth.

 

In addition to farming sector, the concessions are keeping the plight of the informal sector of India in mind. CII, FICCI and business community were pitching for a massive ₹10 trillion fiscal stimulus to kick start the economy and support people who have lost their livelihoods and businesses on the verge of collapse. Modi Government has announced Rs.20 lakh crore relief package for all these sectors that has been disbursed in five phases.

Lockdown 5.0: Unlockdown-1 Guidelines

  • Malls, hotels, and restaurants; places of worship; schools and colleges, are allowed to open in a phased manner over the couple of months. Malls, hotels, and restaurants, and religious places such as temples, mosques, and churches re-open from June 8
  • Schools, colleges, coaching institutes, and other such educational institutions open in July, after due consultations with parents and other stakeholders.
  • The Indian Railways have announced that 100 pairs of trains start running from Monday June 1. Booking is open upto 30 days in advance. These 100 pairs of trains are in addition to the “Rajdhani type” trains that were started earlier.
  • International flights, Metro trains, cinema halls, gymnasiums, swimming pools, entertainment parks, theatres, bars and auditoriums, assembly halls and similar places remain out of bounds for now.
  • Religious, political, and all other such congregations remain prohibited. This means that while you can go to the temple, you cannot join a religious procession in a festival.
  • The night curfew continues to remain in place with relaxed timing from 9PM to 5AM
  • Everyone should wear masks, maintain social distancing and exercise personal hygiene.

Lockdown 4.0 Guidelines: May 18 to May 31, 2020
The Centre on Sunday May 17 extended the lockdown for two more weeks from May 18 to May 31, 2020. However, some major relaxations were given, permitting almost all economic activities and significant public movement.

  • Most things, from public transport to markets, everything has been opened in non-containment zones.
  • All factories, manufacturing units, supply lines and offices can now function without any restrictions.
  • Buses and private vehicles can now move about freely without any special conditions.
  • The government has obliterated the idea of zones, unless you are in a containment zone, for common people. Earlier there were graded relaxations in Red, Green, and Orange zones, with the maximum restrictions applying in the Red zones
  • Certain specific activities across the country are banned. These include air travel — both domestic and international — and Metro rail services. The limited availability of long-distance trains for migrant workers and common public will continue.
  • Schools, colleges, and other educational institutions remain closed, as would be hotels, cinema halls, malls, swimming pools and gyms.
  • You cannot yet go to a dine-in restaurant, but you can order a home delivery.
  • All social, political, and religious functions and gatherings are barred. Places of worship remain shut.

New Lockdown Guidelines allow relaxations from May 4: Key points
Some industries in rural and urban areas will be allowed to reopen from May 4, 2020 to reduce hardships for millions. The government will also allow farm activities, construction of roads and buildings, IT, e-commerce and all inter-state goods transport while keeping in force strong restrictions in hotspots.

Lockdown Guidelines allow relaxations

Relaxation in Lockdown 2.0: 10 Key Points:
India will remain under lockdown until 3 May, Prime Minister Narendra Modi announced on April 14. However, some relaxations may be possible from 20 April. This article explains latest Covid 19 developments in India and the World. Read this article till the end to understand how to discuss Pros and Cons of Lockdown in India in a Group Discussion (GD).

 

India will remain under lockdown until 3rd May, Prime Minister Narendra Modi announced on April 14, while extending measures by another 19 days. However, some relaxations may be possible. The PM said that from 20 April, based on extensive review, a conditional withdrawal of the lockdown will be permitted in some areas where the spread has either been contained or prevented. According to experts, this is being down to ensure that the Food Safety of India is protected as Rabi harvesting season is on anvil. PM Modi said detailed guidelines will be issued on Wednesday which will keep in mind the needs of the informal sector and farmers. India now joins countries such as France which have extended their lockdown.

 

The announcement comes in the wake of rising Covid 19 cases in India. As of April 20, there were 10,363 confirmed cases of Covid-19, out of which 8,988 are active. The pandemic has caused 339 deaths till now. PM said that States had asked for the extension of the lockdown and some had already extended it. Odisha was the first state to extend the lockdown unilaterally. The move was replicated by states like Telangana, Maharashtra, and Punjab which have already extended the lockdown till 30 April.

 

In addition to farming sector, the likely concessions from April 20 are keeping the plight of the informal sector of India in mind.

 

CII, FICCI and business community are pitching for a massive ₹10 trillion fiscal stimulus to kick start the economy and support people who have lost their livelihoods and businesses on the verge of collapse. 

MBA/PGDM Admissions 2020: Application Deadline closing soon | Apply Now!
SPJIMR Mumbai One-Year Full-Time MBA/PGPM IBSAT 2020 Registration Open
IMT Ghaziabad 15 Months Full-Time PGDM Executive IMT Nagpur, PGDM Admissions 2020

New Lockdown Guidelines allow relaxations from April 20: Key points
Some industries in rural areas will be allowed to reopen after April 20 to reduce hardships for millions. The government will also allow farm activities, construction of roads and buildings in rural areas, IT, e-commerce and all inter-state goods transport while keeping in force strong restrictions in hotspots.

 

10 Key Points:

  1. Agricultural and related activities will resume fully to generate jobs for daily wagers and others.
  2. Industries operating in rural areas will be allowed with strict social distancing norms.
  3. To provide an impetus to the rural economy, industries operating in rural areas, including food processing industries; construction of roads, irrigation projects, buildings and industrial projects in rural areas; works under MNREGA, with priority to irrigation and water conservation works; and operation of rural Common Service Centres have all been allowed. These activities will create job opportunities for rural labor, including the migrant labor force.
  4. Manufacturing and other industrial establishments with access control will be allowed in SEZs, EoUs, industrial estates and industrial townships after implementation of SOP for social distancing. Manufacture of IT hardware and of essential goods and packaging can resume.
  5. Coal, mineral and oil production will be allowed.
  6. The Reserve Bank of India, banks, ATMs, capital and debt markets as notified by SEBI and insurance companies will also remain functional.
  7. The government said the digital economy is critical to the services sector and national growth, so e-commerce, IT and IT-enabled services, data and call centres for government activities, and online teaching and distance learning are all permitted activities.
  8. Important offices of Central and State Governments and local bodies will remain open with required strength.
  9. The inter-state transport of goods, essential and non-essential, will be allowed. Highway ''dhabas'', truck repair shops and call centres for government activities can reopen from April 20. So can manufacturing units of pharmaceuticals and medical equipment.
  10. But, all air, train and road travel, educational institutions; industrial and commercial activities, hotels, cinema halls, shopping complexes, theatres stay closed. Also, Social, political and other events, religious centres and gatherings will also not be allowed.

Here are the highlights from Prime Minister's April 14 address

  • Considering all suggestions, it has been decided that the lockdown will be extended till May 3. During this time, we have to be disciplines like we have so far been.
  • Till April 20, all districts, localities, states will be closely monitored, as to how strictly they are implementing norms. States which will not let hotspots increase, they could be allowed to let some important activities resume, but with certain conditions
  • From April 20, those states or areas, which will not allow increase of hotspots or where the possibility of hotposts increasing is less, will see resumption of some essential services.
  • We are moving with great pace on the health infrastructure fund as well. In January, the country only had one lab to test Coronavirus. There are now more than 220 labs working on this front.
  • If India had not adopted holistic, integrated approach, had not taken quick decision then India's situation would have been different.

Covid 19 Backgrounder
Let’s review the background of extending the Lockdown till May 3.

 

In his half an hour speech to Nation on Corona Virus on March 24, 2020 at 8 PM, the Prime Minister of India, Mr. Narendra Modi announced an unprecedented measure of complete lockdown across the country for 21 days to fight the Covid-19 pandemic by following the social distancing which is the only prevention to break the chain of spreading the virus. The measure is to be followed strictly and is much like the curfew except that essential services and supplies would continue to remain available.

 

Announcing the country wide Lockdown, PM Modi said "If situation is not controlled in 21 days, India could go 21 years behind.”  Prime Minister Narendra Modi's announcement came at a time when the number of positive Covid-19 cases are increasing across the country.

 

According to the Prime Minister of India, the gravity of situation can be understood by the fact that even developed nations are struggling to control the spread of the novel coronavirus and if the situation got out of hand, India would have to pay an unimaginable price. PM Modi said "It took 67 days for one lakh people to test positive, it took only 11 days for this number to rise to two lakh, and, it took only four days for the number to rise to three lakh". 

 

The spread was controlled until the Tablighi Jamat congregation in Delhi in March had not spread the virus in all parts of India. This incident is seen as one of the main reasons for extension of Lockdown till May 3.

 

Global Scenario
The global spread of Corona virus that originated from Wuhan city of China, has infected lakhs of people across the world including China, Italy, Iran, USA, UK, Canada, Germany, North and South Korea, and many other countries including India.

 

Let’s look at the global statistics, as on April 14:

  • Total confirmed cases: 1,864,629
  • Change over previous day: 151,955
  • Total deaths: 115,286
  • Total recovered: 2,816,674
  • Nations hit with most cases: US (557,663), Spain (169,496), Italy (156,363), France (133,672), and Germany (127,854).

Source: Johns Hopkins Coronavirus Research Center

 

RBI Announces Policy Rate Cuts: Takes Measures to Counter Economic Slowdown
On March 27, 2020, The Reserve Bank of India joined the big fight with a host of measures aimed at minimising the damage from Covid-19. Reserve Bank of India (RBI) Governor Shaktikanta Das has announced a series of measures including policy rate cuts to bolster economy in the wake of covid-19 menace.

 

Sharing that large part of major global economies are likely to be heading toward recession, the RBI governor stated that economic recovery in 2020 would be slow. This comes hours after Moody's Investors Service cut its estimate of India's GDP growth during 2020 to 2.5 per cent from an earlier estimate of 5.3 per cent.

 

Following key policy announcements were made by the RBI Governor on March 27, 2020:

  • A 75 basis points cut in repo rates was announced as a measure to counter the economic slowdown caused by the COVID-19 pandemic. Now the Repo rate  stands at 4.40% as against 5.15% earlier
  • The reverse repo rate has been cut by 90 basis points to 4 percent. According to RBI Governor this has been done to make it unattractive for banks to passively deposit funds with the RBI and instead lend it to the productive sectors
  • CRR has been reduced by 100 bps to 3%, for 1 year to release 1.37 lakh crores
  • Minimum daily CRR balance reduced from 90% - 80% till 30/06/2020
  • 3.74 lakh crore liquidity injected
  • Banks are allowed 3-month moratorium on all loans. According to RBI, “All commercial, regional, rural, NBFCs and small finance banks are being permitted to allow 3-month moratorium on payment of instalments in respect of all term loan EMIs outstanding on March 31." This is going to be a huge relief for all EMI payers, especially for those — such as the self-employed — whose income had become uncertain in the wake of the lockdown
  • Interest on WC facilities to be deferred by 3 months. Such deferment not to be considered for NPA
  • Total liquidity injection 3.4% of GDP
  • Along with it, the Central government on March 26 announced the first instalment of a fiscal relief package, worth Rs 170,000 crore, to protect the weaker sections of the society from the economic fallout of Covid-19 in the country. Announcing the measures, Finance Minister Nirmala Sitharaman said the PM Garib Kalyan Yojana will benefit migrant workers, rural poor and women.

Understanding Lockdown: A refresher  

  • A lockdown is an emergency protocol that prevents people from leaving a given area. A full lockdown implies that you must stay where you are and not exit or enter a building or the given area.
  • This scenario usually allows for essential supplies, grocery stores, pharmacies and banks to continue to serve the people. All non-essential activities remain shut for the entire period.
  • India, at the moment, is not under complete lockdown. With this announcement the Corona Virus hit cities will be completely shut and borders will remain sealed.
  • Severe travel restrictions have been imposed on some states, and public places have been shut.
  • Train, intercity and interstate bus services have been suspended throughout the country
  • Barring emergency services, all government departments, offices, factories, godowns, weekly markets, shops and business establishments will remain closed during the period.
  • A high-level meeting between Union Cabinet Secretary and Chief Secretaries of the states was held in this regard.
  • Chief Ministers of the states have announced the lock down cities in their states.  

Services Available during Lockdown
Defence, central armed police forces, treasury, public utilities (Including petroleum, CNG, LPG, PNG), disaster management, power generation and transmission units, post offices, National lnformatics Centre, and Early Warning Agencies will remain open.

 

List of Services & Supplies Exempted from Lockdown in All States

  • Police, home guards, civil defence, fire and emergency services, disaster management, and prisons, District administration and Treasury, Electricity, water, sanitation, Municipal bodies, but only staff required for essential services like sanitation, personnel related to water supply etc.
  • Hospitals and all related medical establishments, including their manufacturing and distribution units, both in public and private sector such as dispensaries, chemist and medical equipment shops.
  • Laboratories, clinics. nursing homes, ambulance etc will continue to remain functional. The transportation for all medical personnel. nurses, para-medical staff, other hospital support services be permitted.
  • Shops, including ration shops (under PDS), dealing with food, groceries, fruits and vegetables, dairy and milk booths, meat and fish, animal fodder.
  • District authorities to encourage and facilitate home delivery to minimize the movement of individuals outside their homes.
  • Banks, insurance offices and ATMs.
  • Print and electronic media, Telecommunications, Internet services, broadcasting and cable services.
    IT and IT enabled Services only (for essential services) and, as far as possible, work from home.
  • Delivery of all essential goods including food, pharmaceuticals, medical equipment through E-commerce.
  • Petrol pumps, LPG, Petroleum and gas retail and storage outlets.
    Power generation, transmission and distribution units and services.
  • Capital and debt market services as notified by the Securities and Exchange Board of India.
  • Cold storage and warehousing services.
  • Private security services
    Manufacturing units of essential commodities.
  • Production units, which require continuous process, after obtaining required permission from the State Government.
  • Hotels, homestays, lodges and motels which are accommodating tourists and persons stranded due to lockdown, medical and emergency staff, air and sea crew.
  • Establishments earmarked for quarantine facilities.

What remains Locked during Lockdown Period

  • Offices of the Government of India, its Autonomous/ Subordinate Offices and Public Corporations shall remain closed.
  • Offices of the States Union Territory Governments, their Autonomous Bodies, Corporations, etc shall remain closed.
  • Commercial and private establishments shall be closed down.
  • All other establishments may work from home only.
  • Industrial Establishments will remain closed.
  • All transport services air, rail, roadways will remain suspended
  • Hospitality Services to remain suspended
  • All educational, training, research, coaching institutions etc. shall remain closed.
  • All places of worship shall be closed for public. No religious congregations will be permitted, without any exception.
  • All social/political/sports, entertainment, academic, cultural, religious functions/ gatherings shall be barred.
  • In case of funerals, congregation of not more than twenty persons will be permitted

Pros and Cons of Lockdown in India
In light of above information, lets review the Pros (Advantages) and Cons (Disadvantages) of Lockdown. This can be asked as a GD Topic.

 

Lets first look at some benefits:

  1. Big curb on spread of Corona Virus. This is the obvious and intended benefit.
  2. Reduction in Pollution Levels: Thanks to the lockdown, there has been a drastic decrease in the level of pollution in cities like Delhi, Mumbai, Bangalore, Hyderabad by almost 70 per cent. According to the World Air Quality, the average concentration of PM 2.5 in New Delhi has come down by 71 per cent. There is 50% improvement in water pollution too.
  3. More time for Family and Passions: For the middle class of India, Work from Home has given more time for Family and for pursuing hobbies and passions. A lot of people are connecting back to basics like Yoga and Meditation in times of crisis. This may have a positive impact in long-term.

Negative impacts of Lockdown are many.

 

1. Massive Slowdown of India Economy: Lockdown may have cost the Indian economy Rs 7-8 lakh crore during the 21-day period, analysts and industry bodies have said. Lockdown that brought as much as 70 per cent of economic activity, investment, exports and discretionary consumption to a standstill.

  • World Bank has scaled down India’s gross domestic growth (GDP) growth projection to 1.5-2.8 per cent for the current fiscal year, which would be the lowest economic expansion since the balance of payments crisis of 1991-92, as Covid-19 is dragging down activities in the already slowing economy. It had earlier projected the growth to be 6.1 per cent for 2020-21.

2. Sufferings of the Migrant workers: More than 90% of the country’s workforce is estimated to be from the informal sector. The announcement left little or almost no time for preparation for daily workers who were forced to travel back to their hometowns, hundreds of kilometres afoot as their sources of income had dried.

 

3. Death knell for MSME Sector: The Economic Survey of 2017-2018 had said 87% of the firms in the country, representing 21% of the total turnover, are operating informally and completely outside the formal system. Without support, this sector will be crushed. They don’t have money and labour to run their factories and works, and the supply chain is also disrupted.  

 

4. Panic and Fear in Citizens: When the Central government announced lockdown, it instilled a lot of fear in the minds of the people and led to panic buying since the government had not clearly mentioned what was included in the list of essential items.

 

Stay tuned to MBAUniverse.com for latest GD Topics on Current Affairs and more