Omicron rapidly rising in India has triggered fears of so called third wave, also pushing the negative impact on Indian Economy and it will be deemed harmful for economic development of the country. It will highly impact on agricultural sector, industrial sector, service sector, tourism industry and balance of payments disequilibrium. Our primary agricultural sector across the country is in precarious condition due to Omicron outbreak.

Being a scholar of economics, I must say the policy makers are trying to maintain our forecast of 9% GDP expansion in FY2022, with a clear K-shaped divergence amongst the formal and informal parts of the economy, and the large gaining at the cost of the small. On behalf of the reports, I belief that rising consumption will push capacity utilisation above the crucial threshold of 75% by the end of 2022, which should then trigger a broad-based pick-up in private sector investment activity in 2023.

The government of India will very soon circulate the revised e-commerce policy for raising the online trading pattern while maintaining the SWOOSH economy shape as recovery through its flagship PPP economic model. The Q3 FY 2022 data does not provide convincing evidence of sustainable growth for current Monetary Policy in India and I am sure the Monetary policy committee will definitely change in Indian monetary policy in upcoming budget Feb-2022 to control over economic recovery amid Omicron as fiscal consolidation.

Government of India is also planning to make a roadmap for energy transition in India. The policy makers are well planned maintaining the net-zero emissions by 2070 in India. The oil and gas sector are vital players for achieving the set target by 2070. Today, if we look at global energy system, it is still largely dominated by fossil fuels, with well-established conventional technologies. Coal, crude oil, and natural gas account for about 84% of primary energy, with about 12% from renewable energy and 4% from nuclear in year of 2019.

The energy transition is essentially matching end-use applications with renewable resources using appropriate energy technologies in a cost-effective system, to bring the share of renewable energy to more than 90% if not 100%.

Reports say, Indian oil, GAIL and BPCL have also started the process to set up green hydrogen production facilities as part of their preparation. In between the renewable energy policy the rapid surge in Omicron cases has already led to economic disruptions across many countries in the world due to a fresh wave of restrictions and it is also rising in India and will badly impact Indian economic recovery.

To exert control over the economic growth of country, GoI must focus on its development policy for maintaining the economic revival amid Omicron. The new variant of Covid has set a new measurement of uncertainty for Indian economy and definitely disrupt economic revival speed.

However, it is too early to quantify the risk of Omicron as impact on Q3 FY2022 recovery rate and need to wait for the data of Q4 FY2022 for economic shape of our country. The policy makers not only need to create awareness about the risks and covid-appropriate behaviour. But it is possible to maintain the self-implementation of the Covid protocol though not much is known about the Omicron virus spread. Therefore, there is a need for extreme caution till more is known.   

Image source: Financial Express