SWOT ANALYSIS FOR EMERGING MARKETS LIKE INDIA DURING THE PANDEMIC
"It was the best of times; it was the worst of times"
Dr.Sheetal Nair | Serial Entrepreneur | Storyteller | Author
More than a decade after a global financial crisis that showcased policy tools designed for such traumatic events, the toolbox is dwindling. The outlook for the current financial year 2021-22 has been adversely affected by the resurgence of the COVID-19 pandemic in India and abroad.
Cutting interest rates, a tried-and-true means of encouraging people to buy more things and take out bigger loans, can only last for so long.
In some cases, central banks have revived or amped up their emergency “quantitative easing” programs – aimed at bolstering bond prices and containing interest rates.
Even if policymakers do manage to prompt people to keep pumping money into economies, it remains unclear whether that will be decisive. Fears about COVID-19’s fundamental impact on supply chains needed to get goods into stores run deep, and a lot of stock market volatility is now being automatically triggered by algorithms.
So, me and my partners at our firm DSS Group were in the middle of a whirlwind debate on how to diversify our businesses so that we remain more secure for such future shocks, when we realised that this pandemic is actually an advantage.
How?
Let’s do a SWOT analysis with focus on weakness/threats & opportunities
WEAKNESS/THREATS
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COVID-19 brought an 11-year bull market to an abrupt end. Now, the central bankers faced with the task of stepping in to avert another financial crisis must do so with balance sheets not yet fully recovered since the last one
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The coronavirus calls for wartime economic thinking, in addition to a coronavirus spending bill, India will require a stimulus package worth as much as $2 trillion.
Even in a place like Vietnam that has done an admirable job of containing the spread of the coronavirus, its economic impact – potentially exacting a full percentage point of GDP growth
Despite the best efforts of lawmakers in India, several critical areas of economic stabilization are likely to remain unaddressed
OPPORTUNITIES
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Corruption can be rooted out - The cost of corruption in developing countries like India has been estimated at $1.3 trillion a year, three-quarters of sub-Saharan Africa’s GDP. Perhaps the COVID-19 crisis will galvanize governments to action reduce leakages, creating fiscal space to serve the poor better while setting the stage for recovery and sustained economic growth
The focus on technology based innovative methods to operate businesses will receive a thrust, forceful due to the fact that the pandemic has rendered majority of the population immobile. This shall open up a plethora of options for new ventures or business which thrive on the use of new technology
Examples:
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Medical / Pharmacy (Medkart)
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Grocery Stores (Jio Mart)
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Educational Technology (Udemy)
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Online Gaming (Rummycircle)
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OTT (Voot)
Fitness & Wellness Apps (HealthifyMe)
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Healthcare Consultation & Online Sales (1Mg)
NET TAKEAWAY
During the pandemic the overall, the largest single sector of new business growth was Health Care (16%). The largest combined sector was in Personal Services (Retail, Leisure, and Hospitality), perhaps taking advantage of opportunities as COVID reshaped the personal services economy.
Also, there is a clear shift in business activity from urban areas to suburban areas in 2020-21. Nearly half (46%) of newly created businesses are located in the suburbs, compared to 2019, when just 33% of new businesses were started in suburban areas. These patterns further suggest that the pandemic-induced shift in population and economic activity away from urban cores is a long-term feature of the economic landscape.
Topics : entrepreneur
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First Published: Jul 26 2021 | 5:35 PM IST
