COVID Impact in rural India:
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Impact on agricultural economy: Spread of the pandemic might affect activity, both on the field and in mandis. This will have an impact on both output and demand.
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Rise in unemployment rate:
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The unemployment rate in rural areas has risen sharply in recent weeks to double digits, according to the Centre for Monitoring Indian Economy data.
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Disruption in economic activity in urban areas has once again resulted in mass reverse migration, adding to the unemployment numbers.
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Higher unemployment and lower remittances are expected to keep demand in rural areas muted.
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Under the Mahatma Gandhi National Rural Employee Guarantee Act, about 27.3 million households demanded work under the scheme in April this year compared with 21 million in 2019-20.
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Rising rural wages:
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Migrant workers from the agriculture sector may also have gone back to their villages like last year, pushing up rural wages.
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It is likely that rural India will see a large labour demand-supply mismatch in different areas, which can affect production.
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Near absence of medical infrastructure:
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The requirement of registration and appointment for vaccination has put a large chunk of the rural population in a disadvantageous position.
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There is also a fair bit of vaccine hesitancy.
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