The Corona Effect – What Does It Mean For A Common Man?

The current outbreak of the pandemic coronavirus has disrupted the lives of millions and millions of people around the world. It has a direct impact on the economy of the country. What does it mean for the common man? The “Aam Aadami”. The most equipped question is the financial distress that remains common among all. In general, the life of a common man in a country like India is already filled with hardships and struggles towards his daily livelihood & survival. The pandemic COVID-19 has further added to their disruption and wrecks. Here’s how:

For the very first time, there has been a long lockdown of 21 days in the country (which was never seen before, even during the periods of world-war). The death toll worldwide rose to 30,000+ and 6lacs+ active coronavirus cases as on 29/3/2020. To break this chain of transmission the lockdown was imposed in India on 26/03/2020. The complete lockdown (excluding the essential food-vegetables, milk, groceries, and pharma) has dismantled the life of the common man. 

1. The lockdown means no trade, no business, no production, and no sales, and therefore no profits and no money. This means the downfall & income loss for the companies and industries, manufacturing units and service industries. Worst affected are the small scale units and self-employed / businessmen who have to take care of their workers and employees, paying them even for the lockdown period even when there is no generation of income.
2. The human-to-human spreading virus tosses the health of the common man. Especially for those who have limited geographical access – the act of social distancing goes for a toss. 

1. Hampered are the pockets of the working and middle class, salaried people with reduced or no salaries and almost diminishing bank balances to take care of their children and elderly in the home.
2. Surveys state that nearly 50%+ Indian population opts for taking loans for fulfilling their family needs and upgrading their lifestyle which includes the home loan, consumer loans, car loans, personal loans, business loans, loans against property, etc. The significant aspect of any loan is its repayment. With the financial distress of the pandemic coronavirus affecting the lockdown, the EMI repayments were supposed to be badly hit. But thanks to our nation’s government who called for immediate measures and offered relief in form EMI Holidays and interest deferment for 3 months for the loans outstanding on 1st March 2020. (Read in detail – RBI’s Big Announcement On Financial Aids To Combat Corona-Virus Outbreak) 
3. Lamentation among the low-class daily wage earners, workers, construction workers, and laborers. They are seen migrating in numbers to their inter-state homes, walking miles with their family with women and children because of no work and difficulty in survival. They have no homes of their own, staying on rent is no longer affordable for these daily wage earners. Irrespective of the “PM Garib Kalyan Yojna” announced by the government for the common man, there still seems to be chaos among these classes. Through this Yojna the government has aimed at providing Rs 1.7 lakh crore relief package for those hit hard by the COVID-19 lockdown.
4. COVID-19 resulted in increasing unemployment and poverty for the common man. 
5. People may face a recession in almost all sectors of imports-exports, banking, home loan industry, real estate, IT, E-com, textile, etc. The liquidity in the market will be impeded, irrespective of the 3.74crores of liquidity that is to be injected into the markets through various RBI measures as announced by the RBI governor Shaktikanata Das on 27/3/2020. 
6. In the wake of the lockdown, the affected will also be the old age homes as well as the orphanages – battling for the donations for their very survival.
7. Investors’ money may remain stuck in the investment, especially the SIPs, mutual funds and stock markets- which crashed heavily due to the pandemic crisis. The share prices of the companies tumbled down making new lows, wiping of the profits since 2017. The market experts predict the markets to remain highly volatile maintaining its uncertainty until the COVID-19 exists. Further, the panic selling in the markets further ensures that their investment gets stuck for a longer period now. Although for the long term investors this may seem to book fewer profits on liquidating the stocks under the current scenario but liquidating the stocks for short term investors means booking a loss on the investments.

However irrespective of the deprivation and hardships lets look positively at the implemented lockdown. Looking at the brighter side of the lockdown suggests: 

1. It is for our safety and safety of our loved ones.
2. It will break the chain of transmission, which otherwise would cost heavily to the nation and its citizens.
3. At personal levels, it has increased the family bonding. People, since locked-up in homes, can give ample time to their loved ones which otherwise remained difficult while running in a rat race for earning the money.
4. Children get more fatherly love and affection. 
5. People get time to pursue their passion for painting, music, dance, singing, reading, cooking, etc. and also for reviving their spiritual consciousness.
6. The crashed stock market is the opportunity for investors to make fresh investments in the stocks at low prices.
7. A 75 bps cut in the repo rate is an opportunity for the new home buyers, as the home loan becomes cheaper. 
8. Opportunity for the loan borrowers to enjoy low-interest rates on home loan balance transfer.

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