The impact of the COVID-19 pandemic worldwide cannot be denied. The nationwide lockdowns, imposed to curb the spread of COVID-19, brought life to a halt. The world fell silent and all the resources were diverted to overcoming the crisis.
India’s economic hustle-bustle too came to a screeching halt in 2019. With the exception of essential services and activities, it’s $2.9 trillion economy remained shuttered during the lockdown period. According to the data released by the Ministry of Statistics and Programme Implementation, the Indian economy contracted by 23.9% in the April-June quarter last year, marking the worst decline ever chronicled since 1996.
With the exception of China, every major economy witnessed its GDP contract in the April-June quarter of 2020. India, however, encountered a precipitous quarterly decline (approx. 35%). This was far worse than the United States of America (9.1%) and Italy (17.7%) ― two countries severely hit by the coronavirus.
Despite being the first country hit by the pandemic, China pulled ahead in the world's economic recovery. Compared to 2019, China’s economic output grew 4.9% in the third quarter of 2020. This recovery was propelled by the self-reliance of their economy, be it in the primary (raw material), secondary (manufacturing), tertiary (service) or quaternary (research) sector.
Interestingly, India understood the importance of self-reliance as well, having undertaken taken various self-reliance initiatives such as Make in India, Vocal for local and Atma-Nirbhar Bharat.
What is Atma-Nirbhar Bharat?
Atma-Nirbhar Bharat, India’s self-reliant campaign, kickstarted on 12th May 2020. With a vision to create a new India, PM Modi announced a special comprehensive and economic package of INR 20 lakh crores, equivalent to 10% of India’s GDP, was announced to fight the COVID-19 pandemic in India.
In his speech, PM emphasized on the role of this economic stimulus package in making India self-reliant. The aim was to benefit the cottage industry, MSMEs, laborer, middle class and industries, thereby making the 21st century India, a prospering and self-reliant country.
He outlined the 5 pillars of building a self-reliant India:
1. Economy
2. Infrastructure
3. System
4. Vibrant Demography
5. Demand
The Atma-Nirbhar Bharat stimulus package consists of the following five tranches:
How will the Atma-Nirbhar Bharat initiative impact eCommerce?
Over the last 5 years, the Indian eCommerce industry has witnessed has an upsurge with significant headroom for future growth. According to a report, the eCommerce market is predicted to reach 300 to 350 million buyers by 2025.
This growth revolves primarily around a young demographic profile, rising internet penetration and increasing consumer wealth. Various government initiatives like Digital India, Make in India, Start-up India, Skill India and Innovation Fund, also support the growth of eCommerce.
To promote and encourage the purchase of Made in India products, ecommerce platforms have been asked to display the country of origin on their platforms. Jumping on the “Vocal for Local” bandwagon, eCommerce giants such as Flipkart and Amazon, have already started to shift their focus towards digitizing MSMEs.
Amazon launched the Local Shops initiative on its Indian portal. The program allows local businesses to register online and showcase their products to their local customers. With the aim to help local businesses grow and supplement their income with online orders, more than 11,000 sellers have already enrolled in the program.
They have also signed an MoU with The Confederation of Indian Industry (CII) to increase the export potential of MSMEs in 10 states. They will conduct training, workshops and masterclasses in collaboration, to empower MSMEs to sell online.
Similarly, Flipkart offers a plethora of opportunities to MSMEs to grow and improve their profitability. Samarth, their program to bring Indian artists, handicraft producers and weavers online, is already supporting the livelihood of over 500,000 artisans, weavers and micro-enterprises across the country.
The Road Ahead
Both, Atma-Nirbhar Bharat and Vocal for Local aims to make India a $5 trillion economy by 2025 by establishing local brands, intensifying export activities and move away from imported products. If India sticks to its resolve of becoming self-reliant, it’s aim of becoming a global power is a cakewalk.
The above article has been contributed by Vaibhav Lall, Founder, Khojdeal.
Disclaimer: This article may or may not reflect the views of Mumbai Live
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