Recently, China has crossed paths with COVID 2.0. This makes us curious to know if India will also go through the same phase. If yes, then which sectors will have a positive and negative impact? Let’s find out.
What’s Happening?
Exactly 1105 days back, the world experienced the first case of COVID-19 in China and then followed the pandemic. In 2022, we breathed a sigh of relief as everything returned to normal. But, the recent rise in cases in China is haunting the world. But the question is, how did China fall into the pit of COVID 2.0?
So, it all began with the Zero COVID Policy, through which China decided to have complete control over the situation and imposed strict lockdowns until they reported zero cases. With this strategy, China shot itself in the foot as the citizens started rigorously protesting against strict lockdown. Hence, President Xi Jinping had to abandon his strict Zero COVID Policy. This worsened the situation, and China began reporting higher COVID-19 cases.
Will India Experience Another Wave of the Pandemic?
The story of China is a lot different from India. The Chinese population does not have hybrid immunity. This means that the population has not been exposed to natural infection, and their authorities did not take timely actions to vaccinate the elderly.
Whereas Indians went through three waves that naturally immunised millions of citizens and developed immunity through vaccines. Moreover, 95% of the eligible population has taken at least one dose, and over 88% have taken both doses.
If COVID Returns, Will We See an Impact on Stocks?
According to Economic Times, the broking firm Motilal Oswal believes that a mild spread of the infection won’t have a debilitating impact on any sector.
However, if the new COVID wave is moderate to severe, it will affect airlines, multiplexes, hotels and retail or Quick Service Restaurant (QSRs) companies. Moreover, the stocks of companies involved in diagnostics, testing kits, hospitals and COVID-19 medicine manufacturers will have a positive impact.
What’s Next?
As China is struggling through BF.7, a sub-lineage of the Omicron variant, it is likely that this may lead to global manufacturing and supply chain disruption. India must use this as an opportunity and take steps towards achieving its dream of becoming the world’s next manufacturing superpower.
Until then, keep your mask on and share this article with your friends.
*The sectors mentioned in the article are for informational purposes. This is not investment advice.
