Can India afford another lockdown with a shrinking economy?

India is witnessing the second wave of the Covid-19 pandemic across various states. While the numbers are rising each day, the medical facilities are coming under huge stress, making it difficult to keep up the pace. There is a lot of talk about the possibility of second lockdown that may be imposed by the central government throughout the country.

Many restrictions and partial curfews have been reinstated in several parts of the country already. The violation of social distancing norms is creating a catch 22 situation, as the overcrowding of public places is leading to a huge rise in the number of infections reported across the country.

What if the government has to impose another lockdown at this juncture? Well, the situation will be nothing short of precarious if a blanket lockdown is imposed yet again. While the experts differ, the factors make it plain and clear.

Starting with the retail and recreation sector, India cannot afford any more hurdles in the snail-paced progress of this segment after the first lockdown. It is the most important source of livelihood outside of agriculture. The hotels and restaurants have the single largest share in employment after agriculture, which makes it important to infuse some life into it, instead of bringing the sector to a standstill.

Coming to the agriculture sector, it has always been the strength of our country. What we saw in the 6-month period of lockdown was something outrageous. The agriculture sector was in doldrums and took an eternity to get going. It certainly cannot afford to face any more hurdles in the coming time. In the wake of another lockdown, it would be difficult to bridge the gap in this sector due to obvious reasons.

On the other hand, the share of manufacturing in employment and gross domestic product (GDP) has not been growing in the country. So, it would be near impossible to adjust the workforce in this industry. Contrary to the manufacturing segment, construction and trade have emerged as the main sources of non-farm employment in the last couple of decades. However, a blanket lockdown will put both the sectors in jeopardy.

The second lockdown can well and truly cause massive demand and supply disruptions in the economy. Almost all the sectors haven’t yet come out from the sluggishness caused by the first lockdown. Another lockdown at this stage would deal a massive blow to both vulnerable and slow-moving sectors. It may not even spare the ones witnessing a decent growth trajectory.