Impact of Lockdown on Household Economy

In economics, we have three major entities

We have the producers, the household, and the Government. The household is the most important consumer in the economy. The lockdown has taken a toll on the Indian economy and majorly on the household economy. In this article, we will aim to explore the exact implications that the households have faced due to the lockdown.

In India, about 4% of households have seen a decrease in overall income. This has led to significant economical hardships. A third of Indian households have reported that they don’t have enough resources to go on for a week before facing distress.

These statistics are based on a survey conducted in April by the Centre for Monitoring Indian Economy. I think it’s important that the policymakers of the Indian economy should be aware of this and consider it while making further decisions on the lockdown. The data has also revealed that the economic impact has not been distributed equally over people and places.

It has been varying greatly. About 85% of the households having an income of less than 40000 in a month have been suffering hardships. This is a large fraction of the Indian economy, and it must be taken into account while making a further extension to the lockdown. While the figures are extremely high, more than 90% of households having an income between 13000-40000 have faced a fall in income. 

While economic losses due to the lockdown are widespread among both rural and urban households, rural households have been hit the hardest. With 88% of them reporting a fall in income under the lockdown, compared to 75% of urban households. This is the impact that the lockdown had on the urban as well as rural households. The policymakers must take this into account because this is of utmost importance. 

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Analysis by Sirsha Gupta

New source: The Indian Express