What Is The Impact Of The Indian Epidemic On The Recovery Of The World Economy?

 Analysts believe that the continued deterioration of the epidemic in India will not only affect the country’s economic recovery, but will also have multiple adverse effects on the world’s economic recovery. First of all, the deterioration of the epidemic situation in India has dragged down the global epidemic prevention process and threatened the foundation of the world economic recovery. Georgieva, President of the International Monetary Fund, once said that speeding up vaccination is the top priority of global policymakers, and "a shot in the arm is the fastest way to recover the economy." Some public health experts worry that this round of the epidemic in India is raging and has not yet seen signs of abating, which may bring new variants of the new crown virus and bring severe challenges to the global epidemic prevention process.

　　 Ashish Jha, Dean of the School of Public Health at Brown University in the United States, believes that considering India’s population base, the longer the epidemic lasts, the more likely it is that more mutant viruses will be produced and the effectiveness of existing vaccines will be affected. There are signs that the epidemic in India has begun to spill over to some neighboring countries and regions. If the mutated virus spillover continues, the time for the world to emerge from the shadow of the epidemic will be delayed.

　　Secondly, the shortage of vaccines in India has led to a run on medical resources and aggravated the imbalance of the world economic recovery. The current global epidemic is showing a trend of divergence, that is, the epidemic situation in the United States, the United Kingdom and other developed economies has improved and the economy has recovered steadily, while the number of newly confirmed cases in many developing economies has hit a new high, which has dragged down the economic recovery. India’s role in global vaccination is being forced from a donor to a recipient, forming a run on global vaccine resources.

　　 The Atlantic Monthly of the United States pointed out that the Serum Institute of India is the world's largest vaccine manufacturer and the largest supplier of the "New Coronary Pneumonia Vaccine Implementation Plan" led by the World Health Organization. Judging by the current situation in India, India’s current capacity of 70 million doses of new crown vaccine per month has been unable to meet domestic demand, and vaccine exports have plummeted. India even had to import medical supplies. The consequence was that many developing countries could not obtain vaccines exported by India as planned.

　　Some analysts worry that the world economic recovery has shown an imbalance, and the passive situation of developing countries in response to the epidemic may exacerbate this imbalance.

　　 Once again, the prevention and control of the epidemic in India has increased the tension in the supply chain and brought a chain impact to the industry. The British "Financial Times" reported that some countries and regions have implemented stricter anti-epidemic regulations on ships and personnel involved in Indian routes due to concerns about potential outbreaks of epidemics on cargo ships, putting many shipping companies under pressure to adjust their seafarers.

　　 According to statistics from the International Chamber of Shipping, there are approximately 1.6 million seafarers serving ocean-going ships worldwide, of which 240,000 are Indians. Considering that shipping carries 80% of global trade in goods, the impact of the Indian epidemic on maritime trade cannot be underestimated. Mark O’Neill, president of the International Association of Ship Managers, described the blockage of the Suez Canal channel in March as a “little insignificance” compared with the impact of the seafarers’ adjustment dilemma on the supply chain.

　　 Myron Brillant, executive vice president of the American Chamber of Commerce, said that many European and American companies arrange back-office operations in India and employ millions of Indians. Today, the epidemic is threatening these back-office businesses and is likely to drag down the operations of European and American companies.

　　 Due to the recent worsening of the epidemic situation in India, the outside world's optimistic expectations of India's economic recovery are fading, and some institutions have successively lowered their economic growth expectations. Sonar Varma, chief economist of Nomura Securities' India business, predicts that in the second quarter of this year, the Indian economy may shrink by 1.5% year-on-year. Prakash Sackpal, senior economist for Asia of the International Group, said that there are still some institutions that believe that India’s economy can achieve double-digit growth this year, but this expectation is fragile. “I believe there will be More downgrades".