The 2019 novel Coronavirus has so far caused over 800 deaths, surpassing the toll of the 2003 SARS outbreak. But there are still many unknowns about the virus such as its human to human transmission rate and if it is stable or changing. In the absence of any definitive evidence of the source of the infection, all efforts of developing vaccines or repurposing existing drugs to treat the disease are also still in nascent stages.
The virus outbreak, believed to have started in some seafood and live animal market, has led China to lock down all cities of Hubei province — a major manufacturing center including Wuhan with a population of nearly 11.1 million.
The lockdown could extend considering the number of confirmed Coronavirus cases now, as per official estimates, is around 37,556, of which 6,196 are in severe condition, meaning a potential substantial rise in mortality rate.
What is worrying is that the world economy is a lot more integrated now than it was during the SARS outbreak in 2003 when China accounted for just 4.2 percent of the global economy. China’s share has since grown significantly and now accounts for nearly 16.3 percent of the world’s GDP.
China is now also crucial to the global supply chain for most industries. For example, China trade runs a huge trade surplus of $56.77 billion with India. A deeper look shows Indian exports are also linked to imports of Chinese goods. For instance, the pharmaceutical industry in India imports about $4.5 billion worth of bulk drugs and intermediates from China. This translates to more than 60 percent of its requirements. We formulate the raw materials into finished drugs and export it to world markets. India exported pharmaceutical worth $19.2 billion.
Many other industries are also dependent on Chinese imports.
Indian industry is now waiting for China to contain the disease as soon as possible so that the workers return and plants start production.
Meanwhile, more than 28 countries including India have reported confirmed cases of coronavirus. India reported three cases, all from Kerala studying in Wuhan. Their condition is said to be stable. An increase in the number of cases could have its own economic repercussions within the country.
India needs to stand with China in this hour of crisis because if China’s economy sinks, everyone sinks.-Money Control