Author: Nitish Kumar Naveen pursuing BCOM LLB from University of Petroleum and Energy Studies, Dehradun.
During globalisation, countries have thrived and progressed around the world especially the developing countries. In country like India, it has well connected all over the world. The trade between India and all over world has raised investment in our country which has beneficial for us. After 1991, foreign companies had invested in different field of economic activity in India and carried out massive import liberalisation. It lies for expansion for the global market for better governance at local, national, regional, and global levels. It has advantages not only human, community, and environmental resources but also for people but for not profits. It had major implications on India’s economic, trade and investment relations with the countries of the world. According to Henry Kissinger had predicted that in 21st century of international system will be dominated by six major powers: U.S.A, Europe, China, Japan, Russia and probably India. India will be emerging as a major contender for influence in world affair. The GNP of India is $2.14 trillion in PPP terms in larger than three countries such as Russia, France, and Germany. Despite it, the govt had also taken significant measures for reducing trade deficit. They had control imports and also promote exports. On contrary, it has to be said that during this pandemic in all over the world isolationism is only resolve to combat it. It made to disconnect for trade in all over the world. It had disturbed all the economic activity around the world mainly manufacturing activity. At outset, it had disturbed many sectors like tourism, travel, hospitality and entertainment and emerging markets alongwith developing economic face had unprecedented reversals in capital flow. According to IMF, the global growth fall to -3%. After having effective policy actions for preventing firm bankruptcies, job losses will be recover in project global growth in 2021 to rebound at 5.8%. The huge loss to global GDP during 2020 and 2021 from this pandemic crisis could be 9 trillion dollars which could be more than addition of both the economies of Japan and Germany. In a recession, many enterprises and particularly companies with high leverage or small working capital would fail. There would also collapse many banks and financial entities. Some failures lead to many other failures because they are linked together, as we learned during the 2007-08 global financial crisis. In a deepening situation, business failure would be widespread and the situation cannot soon recover, even after the pandemic has dissipated.
But due to isolationism country like France and Germany not only close their borders to travellers but ban on export of facemask even to their friendly nations. The every country has suddenly fought for itself and there is lack of international interdependence. Amid pandemic has demonstrated fragility of supply chain rather than cooperative international one. The domestic production as a priority, the development of job opportunities, by opening closed plants again, providing domestic and not foreign investments packages, and pursuing a protectionist economic policy to counter unfair competition, were all acts aimed at withdrawing from globalization. But countries have put ban on medical equipment and medical supplies is also sort of self defeating at the global level. Because of this pandemic has omnipresent for every country around the world. This cannot be done without global cooperation even country can isolate from other state and shut their borders and their citizens would have infected in the second and third wave. The actual global crisis on country when put ban on ventilators being exported and food being exported. This made pressure on isolationism and for trade. At optimistic this global crisis could be handled together because crisis can hit back to any country and it cannot be resolved until we work together. The poor countries in Africa have depended on the grace of rich countries. Without their help they cannot deal with this problem. On the outbreak of Ebola in country of Africa has fund raised by the U.S.A to combat with this contagious disease. These countries of Africa cannot stand on isolationism because of their country will become indebt of poverty.
Global coronavirus effects indicate that the global order of the post-coronavirus is not the same. The phenomenon of globalization has in a certain way collapsed; even the most democratic countries have closed borders and cautious, introverted nationalism is once again emerging.
These are following points on Globalisation will change aftermath of Covid-19 Pandemic;
· With the revival in the world's economy, the specific failures could be less and less dependent on China. Substantial supply chains do not in itself indict globalisation, but how companies are dependent on one supply source.
· Economic globalization will continue, but transitions from a global to a regional and bilateral level will continue.
· The emphasis remains on losers of globalization and how to avoid economic harm to jobs. The problem is that the preferred solution — protectionism — does not solve all of the problems.
The post-Cold War era could be marked by the coronavirus pandemic. The delight of ever-growing international integration has gone away. Yet, replacing globalization with the same isolationism and protectionism which has historically oppressed nations will be nonsense.
According to IMF to deal with current pandemic bilateral creditors and international financial institutions will provide loans and grants in order to support the necessary investment in developing countries. Collaborative efforts are needed to avoid de-globalization in the world. Policymakers also need to plan the recovery. When containment is implemented, policies should quickly shift to support demand, encourage firm recruitment and repair the private and public-sector balance sheets to support recovery. Coordinated fiscal stimulus across countries with fiscal space will increase all economies benefits. During the recovery phase, debt repayment moratoria and debt restructuring may have to be continued.
Without global cooperation India like developing countries cannot overcome this pandemic. So govt has taken measures along with bring more resources to bear; on the financial side, by flooding the markets with liquidity; and on the fiscal side, by making direct transfers to households in many countries, postponing tax payments, and also trying to make loans to small and medium-sized enterprises, as well as some large enterprises, to make sure that they can survive.
It has a worrisome situation that every country has taken measures to combat this pandemic which has given according to WHO. But the policy of government has to make effective which can boost the economy of country by giving loans to MSME and credit facility to farmers and extension of the moratorium period to pay EMI or loan. Also govt had increased the FDI in defence sector and date of payment of tax has postponed. Nevertheless, it cannot make direct transfer of fund to their citizens. Govt had taken into consideration for a revival of economy. This is serious concern by govt regarding this issue but govt had not given any monetary benefit to migrant labours who are they jobless and not having to feed their families. This pandemic had faced in all over world. But govt’s of the country had focussed on their economy because they know the economic crisis will come and unstable their state and create a hue and cry around the world. This rescission will be worst than great depression since 2009.