How much time have you lost because of Covid-19? Your company, if you work in one? Your business, if you own one?
How much time has the economy lost on account of Covid-19? The country?
Hint: the answer to none of these questions is 54 days.
That — 54 days — is, of course, the duration of the lockdown till May 17 (it was supposed to end on May 3 but the home ministry on Friday extended the lockdown by two more weeks, although the expanded range of activities allowed in this period suggests that this is more a gradual and graded exit from the lockdown rather than a hard extension). The ministry of health’s latest zoning document — the country is divided into red, orange and green zones — shows that around a third of the country’s population (according to the last census) lives in the so-called red zones, the most affected by the pandemic — and even in these, there has been a significant relaxation of lockdown restrictions. An analysis by Hindustan Times shows that 14 of the country’s 15 most densely-populated districts, including all of Delhi, parts of Mumbai, and Chennai, Kolkata, Hyderabad, and Chandigarh are in the red zone.
Some of the smart people I have spoken to — one of the benefits of being a journalist is that you have access to a lot of smart people, without being smart yourself — say the question on lost time can’t be answered now simply because there is as yet, no cure for Covid-19, no vaccine, and no telling how much worse things could get.
The general consensus is that if the doubling rate — the number of days it takes for the number of infections to double; this is currently at 11.5 days in India — stays the same, and the central government as well as the state governments, and local administrations follow the home ministry’s guidelines and allow what is allowed (without making a fuss about it), then, things should start returning to normal by the end of May, perhaps June. Except, everyone admits, it will be a new normal.
The infection will flare up, from time to time, and, hopefully, in specific areas, necessitating their containment but people will get used to the new normal of wearing masks, perhaps even gloves, social distancing, restricted travel, working from home, and the almost ritualistic cleansing that has to follow any excursion.
Most people also said they’d like to think that India has dodged the bullet — that things won’t get as bad here as they did in Italy, the US, and the UK — but that they are not sure.
So, assuming that this is indeed the scenario that plays out, let us return to the question about time.
For even businesses that will bounce back almost immediately after the crisis — essentials and consumables, for instance — this financial year, 2020-21, will effectively be only nine months long.
For many others, it will be even shorter. And the expectation, even among IT services companies, which get most of their revenue from servicing businesses in other parts of the world is that however long the year is, it will also be a very bad year.
In temporal terms, that means that a company can consider itself fortunate if it ends 2021-22 (next financial year) where it would have ended 2019-20 (the last financial year), provided the last month had not been locked out because of Covid-19.
In simple terms, that means a loss of two years.
Personal finances, for those who have investment portfolios, could take just as long to recover, maybe longer, except for survivalists who invest in gold and nothing else.
But this is at the level of large businesses and the salaried working class, although many of the former will now focus sharply on reducing costs and at least some of the latter will lose their jobs.
Many small businesses will go under, years of hard work wiped out by one Black Swan event. And many people who stopped being poor — India’s big achievement in the years between 2006 and 2016 was to lift 271 million people out of poverty, according to a United Nations report — will slip back into poverty. We have no idea how many yet.
An April working paper by the United Nations spoke of poverty “levels similar to those recorded 30 years ago” in some countries, and the possibility of the overall number of poor people in the world increasing by 420-580 million.
It will be a new world post-Covid