Women’s Perspective: Economic Impact of Covid-19 on Western Economies
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In a recent interactive programme organized by Thinkers Forum in Bengaluru, Finance Minister Nirmala Sitharaman shared her thoughts on the impact of Covid-19 on Western economies. She pointed out that many developed countries adopted a certain method – printing more currency and distributing it among people – to deal with the economic stress brought by the pandemic. However, this method has proven hurtful as an aftereffect in their respective economies.
Sitharaman explained that the huge cash in the economy resulted in inflation shooting up, touching multi-decadal highs in some countries. This approach has resulted in double-digit inflation in their economies, something which wasn’t seen there in 30-40 years. This is a concerning trend that could impact not just their countries, but other countries as well.
Sitharaman also pointed out that some advanced economies having the possibility of going into recession may push India’s exports down as a spillover effect. The recessionary phase will have spillovers worldwide, she added.
The ongoing war in Ukraine was also a topic of discussion. Sitharaman noted that although it may be a war happening in Europe, it had “global repercussions“. Both countries involved in the conflict have a key role in the supply of various essential commodities. Ukraine supplies foodgrains, edible oils, and some military equipment and pharmaceuticals, whereas Russia supplies fuel, fertilizer, and grains.
As a result, every one of these items in the global markets came under severe stress. Sanctions happened for Russia, and Ukraine was in no position to send its grown grains outside. This affected the global grain markets. Sitharaman concluded that COVID-19 wasn’t even completely over when the war in Europe began and it had global repercussions. Fuel prices went up, and food insecurity was seen in many countries.
Re-reported from the story originally published in.. The Statesman
