Visible Impacts of Pandemic on the Indian Economy: Threats and Challenges


The Indian economy has drastically been affected by the COVID 19 pandemic from March 2020 till now. 

The business and service sector has been adversely affected. The education Sector, Tourism Sector, Hospitality Sector, Medium & Small Enterprises, their growth have seen negative numbers.  

45% and more households across the nation have reported an income drop compared to the previous year.

The expenditure of the citizen is directly& positively related to the Income. The rise in Income will increase the spending power of the individual and vice versa.

Twenty three crore Indians have been pushed into poverty after the pandemic has hit us, showed a report by Azim Premji University. 

During this pandemic, the people were only focused on surviving and fulfilling their basic needs, i.e. FOOD, SHELTER, CLOTHING.

The side effects of the pandemic will affect the economy even after the Lockdown has ended future threats and challenges of the economy.


Kristalina Georgieva, the head of IMF ( International Monetary Fund), said that this is the second-worst economic crisis faced by the world since the great depression of the 1930s.

India’s unemployment rate currently stands at around 12%, the highest in three decades.


The absence of a job increases the financial burden on the Household. The presence of a new position in the market is Null.

On the other hand, fresher students who got GRADUATED & POST GRADUATED are also searching for good job opportunities to enhance their career paths.

There has been a rise in search on ONLINE JOB SEARCH WEBSITEs like Linkedin, Naukri, and Indeed.

1 job vacancy posted on the website has 200 applicants. These numbers indicate, How desperately people are in search of a job.

How will Unemployment affect the economy?

  • More people will drop down BELOW the POVERTY LINE.
  • Income disparity.
  • Less spending/ purchasing power.
  • Lack of job opportunities will lead people into criminal acts such as theft, gambling, drug dealing.


Inequality in Income is a considerable threat India will face in the future. India’s richest 1% acquired 73% of the total wealth created in the country in 2017, as per a new survey by international rights group Oxfam. 


67 crore Indians, which belongs to the population’s poorest half, saw their wealth hike by only 1% in 2017, according to the same report. 

The data indicates, “RICH gets RICHER & POOR gets POORER.”

What measures can reduce Income disparity in India?

  • Effective Policies by the Government can tackle & solve 90% of the Income Disparity.
  • Free Ration & best quality Education to the poor.
  • Adequate job opportunities to the poor.
  • Infrastructure development in the Rural Areas and slums in the Urban Areas.
  • Training and action to the poor.


In 2030, India’s population will reach 1.5 billion(estimated), an increase of 13% from 2017.

In comparison, this represents relatively strong population growth, with India becoming the largest country by population globally in 2027. 


India is a highly densely populated country in the world. India ranks 2nd after China. by 2030, India will rank 1st as the highest populated country in the world. 

Overpopulation can be an advantage and a disadvantage.

Here’s How?

  • Staffing workforce.
  • India has the highest youth population in the world
  • Scope for Inventions, Research, Development.
  • High Demand, Low supply.
  • Highly densely (increase in slums)
  • Migration from rural to urban areas.


The side effects of the Pandemic and the Lockdown has reduced the overall ability of a person’s spending power or purchasing power. 

When the spending or purchasing power is concentrated in the economy, the market’s money flow is affected negatively. 

The citizens’ priority is to Survive this Lockdown and pandemic and the ability to fulfil the basic requirements of a Human being.

 The end of the Lockdown would not affect the purchasing power, or spending power as the damage this pandemic has bought to the country is enormous. 

In the future, the citizens will spend smartly, and they will take precautionary measures.


The Indian Government has claimed that it will vaccinate every single eligible adult by the end of 2021. 

Does this claim go hand in hand with action? 

The population of India is estimated to be 132 CRORE. Without the availability of the vaccine, it is nearly impossible to start functioning as it was before the pandemic.

The risk of the third wave is still present. There will be no economic recovery until India vaccinates the majority of its population. 

The uncertain future and the risk of COVID 19 third wave in India is now breaking the wall of patience among the citizens.

India has administered over 13 crore Covid vaccine doses so far, Beginning the drive in January. It will vaccinate 70% of the population in more than eight years to reach herd immunity at the current pace.

Farmil Ansari
Farmil Ansari
Farmil Ansari is a woman dreaming to put her thoughts into words. Farmil is an Introvert but not to the extent that it bridges the gap between her and the people. She loves to do voluntary work. She believes being Empath is a rare treasure in this world. She also writes thoughts and feeling connected deep within the soul on her Social Media Platform. She does not have the ability to Sugar Coat Words. She completed her Post Graduation from Mumbai University. She never was an Extraordinary person but always tried her best to be the best version of herself.



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