Why India's COVID Crisis Threatens the World Economy

  • 2021-05-11
  • 1820

The virulence of the second wave in India seems to be related to a confluence of factors: government complacency, driven by poor data collection and being in denial about the reality of the data; a new variant with a hockey-stick shaped growth curve; and some very large and unregulated religious and political events.

It is clear that there is now a humanitarian crisis of significant proportions. India is a country of 1.4 billion people and makes up a sixth of the world's population. Here are some ways in which it is also going to affect the world economy

For the UK, too, trade links with India are especially important in the aftermath of Brexit. This is demonstrated by Prime Minister Boris Johnson's two attempts to visit in 2021 - both cancelled at the last minute because of the pandemic.

Given all these issues, and the humanitarian crisis unfolding, it has become imperative for the world to act quickly to help India – whether such help is requested or not. We are seeing signs of this coming through, albeit after a short delay, from the UK (oxygen concentrators, ventilators); the US (vaccine raw materials, drugs, rapid tests and ventilators); and Germany (oxygen and medical aid).

Whatever is provided is likely to be a drop in the ocean of India's requirements, but at least it demonstrates a recognition that we are in this together. The Indian government may have been ineffective in the current crisis, but failing to recognise how it will affect the world would amount to an equivalent level of complacency. If the leading powers fail to do everything they can to help out, India's crisis will become a world crisis in short order, not only for health but also for the economy.

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