Amid the second wave of Covid-19 pandemic spreading like wildfire, the evidence of a slowing economy are gradually showing up. Only recently, economists predicted 12-13% GDP growth in 2021-22, but now with the pandemic spreading, such a level of y-o-y growth – even on the back of low base effect – seems far off. In this situation, it seems the only way to get our economic activity back on track is to speeding up the vaccination drive.

According to a latest report, India’s high frequency economic indicators have started to show a softening trend. Retail mobility declined 8.2 percentage points (pp) on average in the week ending May 2, while workplace mobility slowed 7.1 pp. GST e-way bill collection (volume) fell 6.9 per cent on-week for week ending April 25. These trends are not at all encouraging. Additionally, as the second wave is closing in on rural India, this is a real concern also from an economic point of view.

We can find a lot more such indicators around us. Total bank loans contracted by around Rs 63,000 crore between March 26 and April 9; rate of unemployment increased from 6.6% as of the end of March to 7.8% as of April 29; traffic congestion index for major cities are dwindling; people are confined to their homes and spending less; auto dealers are shutting their shops in many parts of the country; and so on. These trends are unlikely to reverse until the pandemic situation improves.

Fortunately, however, this time we have a vaccine to fight back. So far, India has cumulatively administered more than 15 crore doses, which is encouraging, but there are still concerns abound as several states have expressed inability to begin the drive due to supply shortage. In this situation, the Centre and states need to strain every nerve together to speed up the vaccination drive. The faster the vaccination, the sooner the economy can back on its feet.

I invite your opinions.