Introduction: AASC Covid Economic Study

Background:

The world economy changed so fast within the last few months, with the advent of the Covid virus in Wuhan, China. What started as a virus crisis in the Hubei province of China, quickly became a global problem. Thousands died and millions got infected. And the virus is still at large.

The affected countries are in lockdown, shops and factories are closed, people are prevented from hitting the streets, the medical facilities are overloaded, the governments are on alert, and people are staying back at home with fear. And this has created a severe dent in the way our economy was functioning. 

Coming to Kerala, the situation is no different. But the state is faring much better than the rest of India, due to timely intervention by the Government and the support of the people. 

But what happens to the businesses in Kerala, once the lockdowns are withdrawn. Will the businesses operate the same way they did? How much loss will businesses incur and how many will close down? Will it create severe job losses- which again will have a spiral effect on our economy? Or will some businesses seize the opportunity, reinvent themselves and win over others? 

Apart from these questions, every entrepreneur is haunted by the unknown fate- where will his business be post-covid? Among losers or winners.

As the entrepreneurs of Kerala (most of whom are MSME owners, and the major provider of employment in the state), stay at their homes and contemplate on the next move post covid lockdown, what they think about the lockdown duration, its impact on their customers and business will be decisive. 

If their understanding of the crisis is consistent with the reality to come, they can take steps that will help them survive the crisis or perhaps even grow extraordinarily. But if on the contrary, if their expectation is not consistent with what is going to happen, then they might take steps post void, that will prove to be fatal.

It’s a walk on the ice.