by Mansi Choudhary 27 June 2021
Abstract
South Asian countries, which are one of the closest countries to China, have taken various steps to reduce the spread of the pandemic virus. Multiple steps have been taken by the government to control the number of infections in the country. This includes phases of lockdowns in infected areas and federal orders to shut trade to reduce the spread of infection in people. As ASEAN comprises diverse cultures, socioeconomic backgrounds, and geographical differences, measures taken are definitely based on what is most important and applicable to each nation. This article examines what steps and measures by each of the ASEAN countries and further recommendations that can be taken to ensure the issue of human race security in the region can be saved.
Keywords- ASEAN, COVID-19, Coronavirus, South Asia
Introduction
Asian countries have the strongest GDP growth, the impact of COVID19 has affected its economy and has caused serious health issues to its population. On 7th February 2021, more than 110.12 million people in 219 countries and territories have been affected by the disease, and 2.43 million of them have died according to the report of World meters of John Hopkins University.
More than 12 million people have been affected so far, while about 181,000 people have lost their lives due to the disease in South Asian countries. India has been one of the extremely infected nations with a huge loss of life. In spite of the fact that India was first improving, its cases surged speedily in August and September 2020. It has now outreached the second spot for total infections and third on the death count. The positive part is that figures for illness and deaths in South Asia countries have been declining from the end of 2020, and also the situation has improved further. This pandemic has not only affected the health of the humans but also its human cost, employment cost, economic cost, social cost, etc.
As indicated by the report of the Asian Development Bank (ADB), the cost of COVID-19 may increase trade costs through transmission channels, affecting mobility, travel industry, and different businesses, supply-side disruptions that adversely affect output and investment. It has estimated huge worldwide economic loss without and with government policy measures. The report noted that ‘economic losses in Asia and the Pacific could range around US$1.7 trillion under a short containment situation of 3 months to US$2.5 trillion under a long infected situation of 6 months, with the region accounting for about 30% of the overall decrease in world yield. Yet The Economist evaluated that the pandemic could amount to US$10 trillion in forgone GDP over 2020–2021.
The economic cost of COVID-19 for the South Asia ADB report has estimated an overall economic contraction of 6.8% in South Asia, which translates between US$134.3 billion to US$141.9 billion. However, Bangladesh seems to have remained less affected as its economy has maintained a 5%-plus growth rate. Bhutan and Nepal are the two different countries that have remained in the positive growth zone. India, the largest economy in South Asia, has seen a huge nose-dive in the economic sector, and all projections show a contraction in the range of 8% and 10% for India. For example, ADB projects a 9% contraction, while the Organisation for Economic Co-operation and Development (OECD) sees the economy shrinking by 10.2% but by Goldman Sachs, a −14.8% GDP contraction in the Indian economy for the year through March 2021 looks exceptionally overestimated. The Reserve Bank of India (RBI) forecasts the GDP growth at −7.5% for the year ending 31 March 2021. The economic impact has become severe for both Maldives and Sri Lanka due to the near-total collapse of the travel industry. Pakistan also seems to have experienced negative growth of 0.4% in 2020.
China and other East Asian nations have effectively had some early achievements in a manner controlling Coronavirus issues. Without such promptings, stimuli, and support for new investments. The IMF has upheld government financial and fiscal initiatives, proclaiming that it ‘stands prepared to assemble its US$1 trillion loan ability to help its member’ (IMF 2020b). The World Bank has likewise guaranteed an extra US$14 billion to help governments and organizations addressing the pandemic. The IMF has also endorsed debt service relief for 25 qualified low-income countries (LICs), around US$213.5 million, for a year, i.e., from 14 April until mid-October 2020. On 15 April, G20 heads declared their ‘Debt Service Suspension Initiative for Poorest Nations’ from May to the end of 2020 for 73 LICs. It has now added a half-year more, this would cover around US$20 billion worth of bilateral public debt owed by LICs.
Such measures give some temporary help, yet for long-term public and publicly assured external debt of qualified nations, of around US$457 billion out of 2018. The G20 step is seen as only ‘kicking the can down the road’. The heavily indebted poor country initiative and the Multilateral Debt Relief Initiative, the G20 step didn’t reduce the debt, which is to be reimbursed, in full, during 2022–2024. In March G-7 nations’ joint announcement guaranteed ‘a strong coordinated global approach, with no particular activities referenced.
A significant part of the cash has been deployed by means of measures that have not available in the poorest region or for families, and consequently couldn’t offer a lot of support to liquidity-compelled small and micro-investments, and lower-sector families. A review by UNIDO asserted that the portions of firms profiting with government support measures or stimulus deals went from around 10% (in Afghanistan furthermore, Vietnam) to fifty percent (in Malaysia and Mongolia). Generally, bigger firms got more support than smaller ones, which in generally be more vulnerable and face more challenges in getting to fund, even in ‘ordinary’ times. In Bangladesh, such inclinations additionally preferred export-oriented manufacturing.
With firms engaged with monetary vulnerability and proceeded with the financial crisis, investment and recuperation have been postponed. In this circumstance, government spending, investments, and assurances are expected to break vicious circles. Numerous nations help organizations by supporting compensation and different expenses on the condition they hold representatives. In the meantime, pay contingent loans have been utilized to support supplier spending and business investments. For example, Chinese municipal authorities have given vouchers to use or coupons with expiry dates to purchase certain favour and products to upgrade utilization.
COVID-19 and its economic repercussions are the main focus of many countries’ governments today. The government has responded by giving liquidity—e.g., by offering low-interest or without interest credits—to help organizations and laborers endure the emergency. However, such measures have been deficient to permit them to smoothen costs throughout the long term. Transitory remuneration for money shortage will support organizations to continue activities more effectively after ‘implemented suspensions’ because of regulation measures, rather than by heavy debt loads.
Fortunately, a mounting assortment of proof exhibits that seeking low-carbon and environment growth development is the most ideal approach to gain monetary and social advantages. Bold environment action could deliver at $26 trillion in net worldwide financial benefits in 2030. This will helps to make in around 65 million carbon occupations in 2030, comparable to the labour forces of the U.K and Egypt. Indonesia is probably the biggest economy on the planet. The country’s Ministry of Planning founded a low-carbon development pathway and could deliver a good Gross domestic product rate of more than 6% every year until 2045. The report shows this low-carbon development way will outperform financial development in businesses, while it will also help to improve economic, social, and environmental benefits in Indonesia. In 2045, those advantages will provide over 15 million positions.
Many business leaders are taking risk of investing in high-carbon activities and the advantages of moving to a low-carbon will lead to a strong economy. More than 16 company owners with nearly $4 trillion in investments globally have committed to transition their full investment portfolios to net-zero outflow ventures by 2050. Like industries committed to 100% renewable power have better net revenues and profit than those without this commitment. Businesses that are effectively managing and anticipating environmental change secure an 18% better return on investment than businesses that aren’t.
The rate of employment cost as per the ADB report it is between 158 million and 242 million people have lost their jobs due to Covid19. The loss can be translated into a decline of US$1.2 trillion to US$1.8 trillion in labour income. However, Asia and the Pacific constituted 70% of employment losses. However, in terms of labour income, this constituted 30% of the world’s decline in employment. Between US$359 billion and US$550 billion of this reduction caused to the economies in the Asian region.
As of the report of September 2020, India has reported an unemployment rate of over 6%. A huge decline in the GDP growth rate. But the unemployment rate went up to 24% on 17 May 2020. This was possibly a result of a decline in demand as well as the disruption of the workforce faced by companies. In other countries like Maldives, Sri Lanka, Pakistan and Afghanistan have seen similar unemployment rates. Whereas in Bangladesh, Bhutan and Nepal may have seen that to a lesser degree, some of the countries have maintained their development still in the pandemic.
Apart from employment, economic and human loss, the social cost is also severely impacted due to covid19. The lockdown has also affected mental health issues; it is causing more deaths in humans. It is likewise a serious area of concern. Domestic quarrels, depression, violence, divorce, suicide, etc cases are increasing worldwide. As an example, Japan is a peaceful country with law-abiding citizens. As per the government statistics, the number of suicides in August 2020 increased by 15.4% to 1,854. More women and children have committed suicide during the pandemic. In India, ‘65% of therapists reported that there is an increase in self-harm and suicide ideation among patients since the pandemic began, according to a study released by the Suicide Prevention India Foundation.
China has the largest number of production, investments, and manufacturing from all over the world. In the process, China turned out to be the largest investment destination. The amount of US$1.77 trillion FDI stock in China in 2019 substantiates the level of response and success of the call.
Many South Asian Countries have come up with new opportunities to meet the challenges that occurred due to the pandemic. MNCs have also diversified their supply chains to alternative regions or follow a ‘China plus one formula. In this way, decentralisation of manufacturing capacity will bring strong possibility whereby companies may even look to bring production home. Like Japan has already earmarked ¥243.5 billion (about US$2.5 billion) incentive package for companies to move back their factories into Japan or relocate to Southeast Asia, India, and Bangladesh.
Moreover, the pharmaceutical industry got a big boost. There was a major contribution of India as a global pharma-leader for the supply of vaccines. India’s vaccine diplomacy has helped it improve its global reputation as a reliable supplier of medicine worldwide at large.
The South Asian Association for Regional Cooperation (SAARC) founded in 1985, is a regional inter-governmental institution and geopolitical union of Afghanistan, Bangladesh, Bhutan, India, the Maldives, Nepal, Pakistan, and Sri Lanka
All through South Asia, the nations have responded proactively to the issues with India taking to lead by pledging USD 10 million toward a Coronavirus emergency package, steps led by PM Modi in uniting the SAARC heads through a video-call meeting for rising of Covid cases in the countries. This was SAARC’s first important level conference since 2014. While not an official summit, heads of seven nations participated and Pakistan was addressed by its healthcare minister. The gathering was broadcast live on YouTube and broadcast on TV. At the gathering, India’s executive announced a Coronavirus funds account with the first contribution of $10 million. The fund has since got voluntary donations of more than $8 million from most SAARC nations. The SAARC also proposed aggregate approaches to control the pandemic. For example, Afghanistan recommended that SAARC adopt a telemedicine structure to give medical services to many regions. The Maldives called for collaboration among public healthcare emergency offices and a long-term financial recuperation plan for the nation. Pakistan offered to hold a SAARC healthcare videoconference for more participation and proposed building up a working team of public authorities to trade data and information progressively. Sri Lanka emphasized the need to cooperate and make social awareness. Delhi was willing to use SAARC existing mechanism, for example, the SAARC disaster management centre, and proposing the requirement for SAARC to set up new instruments and measures, like research platform to facilitate research controlling virus inside the SAARC region and to develop SAARC Pandemic Conventions demonstrate that it would use as well as strengthen SAARC to extend participation in fighting future challenges like a pandemic.
The positive response of SAARC members to India’s measures with Bhutan, Nepal, and the Maldives making their commitments to the Coronavirus emergency fund to show the obligation to aggregate fight against the pandemic. Delhi’s drive has additionally raised expectations about SAARC’s restoration. Albeit that prospect stays dubious, the experience acquired from cooperating in battling Coronavirus may help make the propensity for collaboration later on. For the present, one thing is clear. India’s call to aggregately battle against Covid and the positive reaction it has gotten from SAARC part states has assisted the nation with setting itself up to better in countering the pandemic that requests direness and locale wide reaction.
This pandemic is an opportunity to put aside traditional concerns and cooperate to take joint measures. Short-term collaboration to fight the pandemic could bring longer-term benefits by strengthening regional institutions, improving regional infrastructure and connectivity, advancing trade policy, and developing cross-boundary solutions to shared issues. The World Bank is a dedicated accomplice of regional collaboration in South Asia and stands prepared to give technical and monetary help as the nations marshal regional sources to focus in on the human cost of Coronavirus. South Asia has accomplished huge progress through participation in the focused sector, and that experience can be applied to concerned sectors like food security, basic coordination, and better healthcare.
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About the author
Ms. Mansi Choudhary is a second-year (2019-2024) student pursuing BBA-LLB (HONS.) from ICFAI University, Jaipur. She is keenly interested in article and research writing.
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