The impact of coronavirus epidemic on Indian trade is estimated to be nearly 348 million dollar. According to a report by United Nations, the country is one among the 15 most affected economies because slowdown of manufacturing in China disrupts world trade.
“The spread of the new coronavirus is a public health crisis that could pose a serious risk to the macro economy through the halt in production activities, interruptions of people's movement and cut-off of supply chains” - Japanese Finance Minister Taro Aso. G20 gathering in Riyadh, Saudi Arabia, February 24, 2020.
United Nations Conference published an estimate on Trade and Development (UNCTAD) on Wednesday stated that slowdown of manufacturing in China due to coronavirus (COVID-19) outbreak is adversely disrupting world trade and could result in a 50 billion dollar decrease in export across global value chains.
Precision instruments, machinery, automotive and communication equipments are among the most affected sectors. European Union (USD 15.6 billion), the United States (USD 5.8 billion), Japan (USD 5.2 billion), South Korea (USD 3.8 billion), Taiwan Province of China (USD 2.6 billion) and Vietnam (USD 2.3 billion) are among the most affected economies in the world.
Trade impact in India is estimated to be the most for the chemicals sector at 129 million dollars, textiles and apparels at 64 million dollars, automotive sector at 34 million dollars, electrical machinery at 12 million dollars, metal and metal products at 27 million dollars and wood products and furniture at 15 million dollars.
Pamela Coke-Hamilton, who heads UNCTAD’s Division on International Trade and Commodities, said for developing economies that are reliant on selling raw materials, the effects could be felt “very, very intensely.” “Assuming that it is not mitigated in the short-term, it’s likely that the overall impact on the global economy is going to be significant in terms of a negative downturn,” she said.
“Besides its worrying effects on human life, the novel strain of coronavirus (COVID-19) has the potential to significantly slowdown not only the Chinese economy but also the global economy. China has become the central manufacturing hub of many global business operations. Any disruption of China’s output is expected to have repercussions elsewhere through regional and global value chains,” UNCTAD said.
“The 2 per cent contraction in China’s output has ripple effects through the global economy and thus far has caused an estimated drop of about USD 50 billion across countries,” UNCTAD said. “The most affected sectors include precision instruments, machinery, automotive and communication equipment,” it added.