File photo. Photograph:( Reuters )
India is already preparing for the future by encouraging investment in the electronic vehicles sector
The coronavirus has cost the world approximately 16 trillion dollars and recession hit all five continents, leading to a loss of nearly 400 million jobs.
The financial year 2020 saw insolvencies and closures and the global FDI fell 42 per cent. However, FY 2021 is about building back and not letting history and China repeat itself.
Morgan Stanley projects global GDP growth of 6.4 per cent for 2021 and IMF projects it 5.4 per cent. The World Bank says the global economy will expand by 4 per cent.
For any of these numbers to convert, countries around the world will have to adapt to the changing economic order and they will have to keep a close watch on the emerging trends, while also working towards diversifying their supply chains from China.
The coronavirus crisis has come with opportunities for radical reform, building better healthcare. The world must also look at re-aligning priorities and Japan is already at it.
Over 40 per cent of Japanese tech companies are shifting their manufacturing base from China. West Asia is adjusting to the new oil order by diversifying its economy.
The start before the United States is to get a grip on the pandemic, before rebuilding its economy.
India is gearing up for its first budget since the pandemic which will be tabled on February 01. The country is already preparing for the future by encouraging investment in the electronic vehicles sector. It is working towards becoming the world's largest EV market.
India is also trying to leverage its online market. A recent report from the United Nations says India's foreign direct investment grew 13 per cent in FY 20 and much of it had to do with investment in the digital sector.
In the last one year, the coronavirus pandemic pushed many consumers and companies online. This shift in consumer behaviour was more evident in India which is the world's second-biggest online market.
India was among the only two major countries that saw an increase in the FDI despite the pandemic as $57 billion poured into India in 2020. The number is likely to increase in FY 21 as more companies move out of China.
The UN report also points at an interesting trend that says inflows to the US and Europe dropped into negative territory. However, in South Asia, FDI rose 10 per cent to $65 billion.
This growth, again, was steered by India, and now New Delhi will be looking at all these trends closely as it prepares for February 01.