A False Comparison COVID-19 Financial Crisis with 2008 Global Financial Crisis

A False Comparison COVID-19 Financial Crisis with 2008 Global Financial Crisis 

It is false comparison of COVID-19 with Global financial crisis. The decline of economic activity in COVID-19 is unexpected in the history of India. It's impact on manufacturing, real industries is different what was witnessed in 2008 global crisis. The fall down of industries may be similar but the reality is different, 2008 global financial was slow burn, economy takes few month to slow down, but in COVID -19 financial crisis it is sudden dip of all economic activity. The Pandemic outbreak causing supply disruption and social distancing effort necessary to control spread of corona virus it has imposed a large burden on workers and their family. The unexpected speed and depth of the contraction in the economy is unexpected and much worse than 2008 global financial crisis. 

Most have pointed that 2008 Global Financial crisis is same as COVID-19 Financial crisis, That would be unfortunate mistake. What worked around 11-12 year ago won't work today because today situation is different. The COVID-19 pandemic is mirror image of Global financial crisis, the policy response should be crafted accordingly. The Global financial crisis was a financial shock to several real, manufacturing industry, whereas, COVID-19 is a public health crisis. This ruthless crisis impact transportation ban, lockdown, restriction on public gathering.

The COVID-19 financial crisis is totally different form 2008 global financial crisis, In the pandemic crisis we are facing huge demand shock consumer and business have rerouted their consumption habits, due to pandemic people have reduce their time outside the home and forced to stay at home we are facing supply shock and huge unemployment gap.

Sectors negatively impacted in COVID-19 Crisis

         

               Sector                                                    percentage affected

1. Vehicle construction and accessories sector        ---   99%

2. Machine and plant construction                          -----  84%

3. Transport, logistic and tourism                          --------77%
4. Textile and clothing                                             ------ 75%
5. Retail and E- commerce                                       -----  38%

 Sector negatively impacted in 2008 Global financial crisis 

1.  Supply dealer
2. Home furnishing Stores
3.Manufacturing plants
4. Motor Vehicle dealer
5. Cement and concrete manufacturer
6. furniture stores
7. print media