Corona pandemic has brought damage to the world economy which seems to be irreparable. It is obvious that the economy of a country like Nepal which is largely dependent on remittance and import is no exception. Let us discuss the impact of COVID-19 lockdown in Nepal’s economy:
1. Reduction in GDP:
Organizations like world bank and IMF had predicted a GDP of around 6% for the financial year 2020-21 pre lockdown. This is sure to go down substantially due to extended lockdown because the service and manufacturing sectors are at a complete halt. There is almost nill production in an already import-dependent nation.
2. Drying Tourism Industries:
Tourism contributes major portion in Nepal’s economy which sadly is almost at the verge of shutting down due to global travel restriction and closed airports and borders. Government through it’s various initiatives like visit Nepal 2020 was expecting almost 20 lakhs tourist this year which now has turned almost impossible to achieve. Industries like Hotel, restaurants, Bar etc. has suffered spine breaking loss where most of them are at the verge of shutting down.
3. Rise in Inflation:
There is no science in guessing that lockdown has greatly inflated market which is mostly import dependent. There is hike in logistic cost and various transport difficulties leading to inflation in basic amenities in Nepal.
4. Delay in Projects:
Various government and non-government projects will be delayed because of this lockdown as there is scarcity in the supply of manpower and raw materials. Delay in such projects is sure to hamper financial planning and budgeting to a large extent.
5. Unemployment :
Most of the establishments are laying off their employees as they have no revenue. Similarly lakhs of Nepalese abroad have no work at hand because of the global effect of pandemic. Their remittance dependent family back home has no alternative to meet their ends.
A pandemic cannot be predicted, therefore no one is specifically to be blamed for this. However, the government along in association with the various organizations can certainly plan an effective responsive plan to tackle the economic impact of COVID-19.