WHO ROLE IN COVID-19 VACCINE

By Moksha Grover

Covid-19 pandemic has changed the world completely, with affecting almost all the countries around the globe. Today, the whole world is struggling against covid-19. Amidst this fight, it has been declared that with the help of WHO we can win this fight against covid-19. Covid-19 has been declared as a pandemic by world health organization on on March 11, 2020 and since then, WHO has been helping a lot to end this pandemic situation. Safe and effective vaccines, being manufactured everyday are really crucial to end this pandemic. WHO has been working tirelessly in manufacturing and developing these vaccines and also ensuring equitable distribution of theses vaccines.

UPDATING COVID CASES

WHO plays a significant role in determining the covid cases around the globe. For the production as well as the distribution of vaccines, it is important to know how much Covid cases each country has, so that the vaccines can be manufactured and distributed accordingly. This task is being accomplished by World Health Organization (WHO).  WHO updates about covid cases worldwide with the help of statistical tools used for analyzing like graphs and histograms. There is one graph for the overall worldwide covid situation and separate graphs for each country. WHO also helps in providing a better understanding of covid situation by using graphs and histograms in such a way that even a layman can understand it.

This is a recent graph provided by WHO showing 221,134,742 total covid cases and a total of 4,574,089 deaths by covid around the globe as of 7th of September, 2021[1].

WHO also has kept us updated about some vital information about covid like when it became airborne, its second and third wave etc. It also uses apps like twitter and Instagram to update people about the latest information relating to covid. To accomplish all these tasks, WHO has set up a full support team for updating people time to time and also providing assistance to people in this pandemic.

DEVELOPING OF VACCINES

WHO has brought together 400 of the world’s leading researchers to identify research priorities for the manufacturing of vaccines[2]. “Solidarity Trial”, an international clinical trial, involving 90 countries is also one initiative launched by WHO, to help find effective treatment[3]. WHO has also taken up research protocols for better understanding of the virus. Approximately 130 scientists, funders and manufacturers from around the world have signed a statement committing to work with WHO to speed the development of a vaccine against COVID-19[4].

In addition to this, the world health organization is giving its best in making people understand about vaccines, its side effects, its importance etc. by uploading various pdfs and data files on its site.

Above is the cover page of one pdf file uploaded by WHO on their website which tells everything about the working of the vaccines, its benefits, vaccines by different companies etc. In addition to this, WHO has also answered the most asked questions about covid-19 vaccines.

WHO has also given details of various vaccines launched by different companies and have listed their side effects too. It has also helped in the approval of various vaccines given by Pfizer, Johnson & Johnson, Oxford, Serum Institute of India etc. On its website of Covid-19 vaccine tracker, WHO lays down the list of all the approved vaccines along with the number of countries approving these vaccines and the number of trials in other countries.

EQUITABLE DISTRIBUTION OF VACCINES

The world health organization (WHO) has a very big role to play in the equitable distribution of vaccines. For equitable distribution of vaccines, WHO has unveiled its global plan to fairly distribute covid-19 vaccine. two-thirds of the world’s population have joined its plan to buy and fairly distribute COVID-19 vaccines around the globe[5]. As per WHO’s “fair allocation mechanism” distribution of vaccines will be conducted in two phases.

In the first phase, all countries would receive vaccine proportional to their population; initially enough vaccine to immunize 3% of their population, with the first doses going to frontline workers in health care and social care[6]. Then, additional vaccine would be delivered until 20% of a nation’s population is covered. WHO envisages that these doses would be used to immunize those at the highest risk from COVID-19: elderly people and those with comorbidities[7].

Second phase would be dealing with the countries where vaccinations are needed to cover additional people on the basis of the urgency of immunizations needed. The priority will be decided on the basis of two criteria’s.

  • The magnitude of spread of virus whether it is spreading very fast and whether other pathogens like influenza are also spreading at the same time
  • Whether the health care system of the country is strong or weak, whether it has sufficient beds in hospitals for its patients and other intensive care units etc.

 RESULTS OF THE PLAN LAUNCHED BY WHO

The plan by World Health Organization (WHO) is still in progress and it is said that additional 38 countries are expected to sign soon[8]. Access to the vaccines in the COVAX portfolio will be given to these countries and they will pay for their own doses. It has secured an estimated 700 million vaccine doses so far and wants to provide 2 billion by the end of 2021, with the aim of providing coverage to at least 20% of the population of participating countries[9]. The WHO has also called for moratorium on Covid Vaccine Booster Shots till end of September to address the drastic inequity in dose distribution between rich and poor nations[10].

WHO ASSISTANCE TO COVID-19 ECONOMY

The world health organization (WHO) in collaboration with other organizations initiated a global collaboration known as the Access to COVID-19 Tools Accelerator (ACT Accelerator) with the motive of accelerating the development, production, and equitable access to COVID-19 tests, treatments, and vaccines.

 So far 10 countries have contributed $2.4 billion to the work of the ACT Accelerator, with the United Kingdom committing just over US$ 1 billion, and Germany, Canada, Japan and France committing US$ 618 million, US$ 290 million, US$ 229 million and US$ 147 million respectively[11]. In just seven months, the ACT Accelerator’s progress has been significant: over 50 diagnostic tests have been evaluated and new rapid antigen diagnostics have been developed and being made available for LMICs; life-saving Dexamethasone treatments are being rolled out, research into monoclonal antibody treatments is advancing; and through the Health Systems Connector, the health system requirements for delivery of COVID-19 tools have been mapped in 4 out of 6 world regions[12].

It is now being reported that the countries who have contributed to ACT will now be able assess economic benefits to advanced economies in result of their contributions. Global equitable access to COVID-19 vaccines estimated to generate economic benefits of at least US$ 153 billion in 2020–21, and US$ 466 billion by 2025, in 10 major economies, according to new report by the Eurasia Group[13]. With the help of introducing these policies and initiatives, WHO is now helping the falling economies of many countries to come to the positions they were on before this covid pandemic.

CONCLUSION

In order to sum up, I’ll like to say that WHO is working tirelessly to improve the covid-19 situation across the globe as well as supporting many economies in these hard times. Furthermore, WHO has also given certain guidelines for people to follow that’ll surely help in decreasing covid cases. Guidelines on vaccines are also given. All these guidelines are available on WHO websites. WHO has also conducted free campaigns to spread awareness. These efforts by WHO will only be fruitful when people follow all the instructions and guidelines in relation to covid 19 prevention and also get all the vaccinations properly for immunization. In order to win this fight against covid-19, it is advised to all the people to take necessary precautions and get vaccinated as soon as possible


[1] ‘WHO Coronavirus (COVID-19) Dashboard’, World Health Organization < https://covid19.who.int/> accessed 8th September,2021

[2] ‘5 reasons the world needs WHO, to fight the COVID-19 pandemic’, United Nations (9th April 2020) < https://news.un.org/en/story/2020/04/1061412> accessed 8th September,2021

[3] Ibid.

[4] Ibid.

[5] Kal Kupferschmidt, ‘WHO unveils global plan to fairly distribute COVID-19 vaccine, but challenges await’, Science (21st September,2020) < https://www.science.org/news/2020/09/who-unveils-global-plan-fairly-distribute-covid-19-vaccine-challenges-await> accessed 8th September,2021

[6] Ibid.

[7] Ibid.

[8] Ibid.

[9] Ibid.

[10] ‘World Health Organisation Calls For Moratorium On Covid Vaccine Booster Shots’, NDTV (August 04, 2021) < https://www.ndtv.com/world-news/coronavirus-world-health-organisation-calls-for-moratorium-on-covid-vaccine-booster-shots-2502715> accessed 8th September,2021.

[11] ‘Global equitable access to COVID-19 vaccines estimated to generate economic benefits of at least US$ 153 billion in 2020–21, and US$ 466 billion by 2025, in 10 major economies, according to new report by the Eurasia Group’, World Health Organization (3rd  December 2020) < https://www.who.int/news/item/03-12-2020-global-access-to-covid-19-vaccines-estimated-to-generate-economic-benefits-of-at-least-153-billion-in-2020-21> accessed 8th September,2021.

[12] Ibid.

[13] Ibid.

GOVERNMENT ASSAULT ON FREEDOM OF SPEECH IN INDIA

By Moksha Grover

The year 2021 has shown catastrophic effects on India so far. The country has witnessed a devastating second wave of covid-19 which continues to rage on with the official death toll being over 3,50,000[1]. Hospitals in India run out of beds and medical oxygen because of the country’s paralyzed healthcare infrastructure. But the most important point to be noted here is that India increased its oxygen exports by 734 percent in January 2021, and exported around 193 million doses of vaccines[2]. Justifying the export to other countries, union health minister Harsh Vardhan claimed that the country was in a virus endgame. However, at the end of April 24, the total confirmed cases of coronavirus stood beyond 16 million with less than 2 percent of the population fully vaccinated[3].  When the people started questioning the government, the government in response reportedly directed Twitter and other social media platforms to remove over 100 posts and URLs criticizing India’s handling of its second nationwide COVID-19 wave[4].

It forced social media companies, especially Twitter, to stifle expression, and if the companies don’t obey they face the threat of punishment from the government. This is one example of the recent case of assault followed by the Indian government in relation to the freedom of speech in India.

IMPORTANCE OF FREEDOM OF SPEECH AND EXPRESSION

Freedom of speech and expression as regarded by Mahatma Gandhi

“the two lungs that are absolutely necessary for a man to breathe the oxygen of liberty”. Article 19 of the United Nations’ Universal Declaration of Human Rights, 1948, states that “Everyone has the right to freedom of opinion and expression; this right includes freedom to hold opinions without interference and to seek, receive and impart information and ideas through any media and regardless of frontiers.”[5]

The Indian Constitution provides for the right to freedom of speech and expression under Article 19(1)(a).[6] This right can be restricted on the basis of grounds provided in Article 19(2), which are: in the interests of sovereignty and integrity of India, security of the State, friendly relations with foreign States, public order, decency or morality or in relation to contempt of court, defamation or incitement to an offense [7]. The right to articulate opinions without fear of retaliation, censorship, or punishment carries significance in the life of every human being, thus making the right to expression important for all human beings. Freedom of speech is an important right because a person’s voice is sometimes all that person has. To take away a person’s thoughts and opinions is to strip their life away.

THE CRISIS OF FREE SPEECH                        

   In the last few months alone, Delhi Police has made international headlines for visiting Twitter’s India offices to “routinely” investigate its policies on tagging content as manipulated media. The Union Government has strongly instructed Twitter to remove all the tweets critical of Prime Minister Narendra covid response. Many activists have been arrested by the government for mobilizing support for the farmers’ protests. Multiple FIRs have been filed against journalists for reporting on Covid deaths and oxygen shortages. Last year, two Malayalam news channels were suspended for 48 hours by the Union Ministry of Information and Broadcasting for reporting the Delhi riots. This year, a comedian also got arrested and spent the whole of January in prison for the jokes he never cracked. The latest illustration of the assault on free speech is the government’s response to protests against the new farm laws. Instead of allowing peaceful assembly, the government in Delhi started building barriers on protest sides with nail beds or concrete walls. They blocked the protests. Many protesters were arrested. Violence erupted on many occasions and the farmers traveling to Delhi were placed under house arrest in Agra to cut at the root of the protest. Also Recently, three FIRs have been filed against union minister Narayan Rane for his remarks against Maharashtra Chief Minister Uddhav Thackeray while giving a speech in Raigad district on Monday. His support in Mumbai also clashed and two of his supporters and two policemen were injured in the clash. Furthermore, in an English weekly, Organizer, was said to be publishing communal writings and was ordered by the Chief Commissioner of Delhi to submit all materials for prior censorship There are numerous other cases that depict the crisis of free speech in India.

IS THE ASSAULT FOLLOWED BY THE GOVERNMENT TENABLE?

The failure of the government to control the covid-19 cases in India and handle the pandemic has resulted in us bearing the worst covid surge in the world. However, instead of being accountable for its lapses and listening to its citizens, the government is prohibiting people from even talking about it. It is trying to suppress the voices of all the people who have been affected by the wrong decisions of the government. Such attacks on free speech end in the tipping away of balance from constitutional freedom; of late, the higher judiciary seems to be complicit in this absurd process[8]. One must realize that liberty once lost is lost forever and censorship is undoubtedly against the very foundation of a free society.

THE TWO MAJOR FREE SPEECH CHALLENGES FACED BY THE WORLD

There are mainly two major free speech challenges faced by the world, Today. In most developing countries like ours, the legal system isn’t strong enough to guarantee freedom of speech and needs to be revised. In other developed countries like the U.S free speech is increasingly being mixed up with absolute speech. In developed countries, the fight for freedom of speech has shifted to normalizing hate speech’s and to

 Silence minorities. As said, words always have consequences. One such example was a surge in anti-Muslim attacks in the UK after Prime Minister Boris Johnson called women in burqas “bank robbers”, and similar incidents happened everywhere[9]. In India, the government keeps suppressing its critics and agrees to give a free pass to all those who abide by its values. Hate speeches are allowed to be shown on national television considering, that these hate speeches are directed toward minority communities. Even by the American standard of “imminent lawless action”, chanting “Desh ke gaddaro ko, goli maaro saalo ko” at rallies would be considered wrong, and yet it seems to be acceptable here[10].

PROTECTING AND PROMOTING FREEDOM OF EXPRESSION

Social Media has given a voice to almost everyone. But the digital world, like our real world, is not a level-playing field and those with power quickly learned how to use it to their advantage. In India, along with direct suppression, indirect suppression is also being followed through the way of troll armies that abuse people and flooding tactics (fake news, propaganda bots, paid commentators) that drown out real voices. Sticks and stones have always broken bones but words hurt twice as much. Social Media companies need to develop good terms and conditions to tackle all the misinformation and hate speeches. Online platforms should make it harder for people to share misinformation. Since women and children are mostly targeted online, companies should ensure to make their platforms a space to share ideas and not to harass people by employing sufficient moderators. We should keep fighting for the right to expression in India but at the same time keep in mind that our right to express opinions should not stifle the voices of other people or put them in danger.


[1] Jacob Mchangama and Raghav Mendiratta, ‘Supporting free speech, but not a criticism of government’, The Indian Express (June 25,2021) <https://indianexpress.com/article/opinion/columns/supporting-free-speech-but-not-criticism-of-government-7376023/> accessed 26th August 2021

[2] MD Tasnimul Hassan,’ Latest salvo in the crisis of free speech in India’, The Leaflet ( 27th April 2021) < https://www.theleaflet.in/latest-salvo-in-the-crisis-of-free-speech-in-india/&gt; accessed 26th August 2021.

[3] Ibid.

[4] Ibid.

[5] Ibid.

[6] Ibid.

[7] Ibid.

[8] Ibid.

[9] Sourabh Yadav, ‘Right to free speech is democracy’s precious gift, but not when it stifles others’ voices’, The Print (December 2,2021) < https://theprint.in/campus-voice/right-to-free-speech-is-democracys-precious-gift-but-not-when-it-stifles-others-voices/555715/> accessed 26th August,2021

[10] Ibid.

HOW WILL ASSET MONETISATION HELP THE GOVERNMENT?

By Moksha Grover

Finance Minister Nirmala Sitharaman announced on Monday that the Indian Government intends to monetize ₹6 lakh crore worth of state-owned assets over the next four years under its asset monetization pipeline. The union government has said that they’ll allow the private sector to bid for operating the assets for 25 years, and with a lump sum payment upfront, but without giving away title to the underlying assets. The Centre aims to sell off gas pipelines, roads, railway assets, and warehousing facilities among a host of other assets with the help of the National Monetisation pipeline (NMP).  The private sector can operate these assets for 25 years but they have to calculate what they can earn from it in various ways, over the next 25 years; discount that cash flow to its ‘present value (PV), deduct from that their profit margin, and pay the balance amount as an upfront rental to the government[1].

Lets us assume the value of the said asset is Rs 100. And return to the asset in real terms is 4% per annum (net of inflation)[2]. The present value of the 4% earnings, discounted at the real rate of interest to such an operator, assuming it is 6%, (again real as opposed to nominal rate) would be Rs 51.3[3]. Let us round it off to 50. Rs 50 represents the PV of an annuity of Rs 4, over 25 years, discounted at 6% per annum[4]. In effect for every Rs 100 of assets monetized, the cash flow yield from the asset that the operator can expect is Rs 50[5]. From this, he must deduct the return that he expects from his investment, the risk premium attached to the earning, and the general uncertainty of dealing with a capricious government[6]. Assume the operator wants a minimum of 50% return on his equity[7]. He will then be willing to pay Rs 35 (rounding off the calculation) for the Rs 100 assets[8]. One doesn’t know if the Rs 6 trillion number is indeed the market value of the assets[9]. But assuming it is, then the total value of upfront rental it can expect from such monetization will be in the region of Rs 2.1 trillion or less[10]. In fact, given normal discounting rates of 50% in such cases (100% return on capital), the government should expect no more than Rs 1.5 trillion[11].

WHY IS THE GOVERNMENT DOING THIS?

The Indian government has been facing a silent budgetary crisis. This crisis resulted because of disasters like demonetization, tax cuts for corporates, and GST made by Modi. Because of these serial disasters, the GDP growth of the country has fallen drastically. As a result of GDP falling, Modi had to steeply hike the prices of inelastic commodities like petroleum products to pay for corporate tax cuts. The price hike and hike in direct taxes burden the lower and middle-class people, indirectly, and hence, they have to reduce their consumption. So their consumption falls dragging GDP growth down even further. As a result of all these events, the economy tanked by sinking GDP by 28% in one quarter[12]. The GDP for the full year fell by 7%, the highest of any major economy[13]. All the government revenues are left plummeting and deficits soaring, thus necessitating record borrowings to pay for government expenses. Presently, the government debt as a percentage of GDP now stands in the region of 90%[14]. Government tax and non-tax revenues are expected to be 22.7% of GDP, and the combined government deficit is projected at 6.3%[15]. So, the government was left with no choice introduced asset monetization to fill its coffers. As and when, asset monetization will take place it will add up to the non-tax revenues of the government. All this trickery comes in the backdrop of India’s worsening credit ratings, which are just about a notch above junk, with a negative outlook.

FEW POINTS TO KNOW ABOUT ASSET MONETISATION

  1. Asset monetization involves monetizing brownfield assets and does not include the selling of land.
  2. “Ownership of assets will remain with the government and there will be a mandatory hand-back,” as said by finance minister Nirmala Sitharaman[16].
  3. The infrastructure line ministries included the pipeline—Roads, Transport and Highways, Railways, Power, Pipeline and Natural Gas, Civil Aviation, Shipping Ports and Waterways, Telecommunications, Food, and Public Distribution, Mining, Coal and Housing, and Urban Affairs—along with Secretary (Department of Economic Affairs) and Secretary (Department of Investment and Public Asset Management)[17].
  4. The estimated value corresponds to 14 percent of the proposed outlay for the Centre under the National Infrastructure Pipeline ( ₹43 lakh crore)[18].
  5. Asset Monetisation aims at tapping private sector investment for new infrastructure creation.
  6. Asset Monetisation is important for employment opportunities and generation, which will further help in accelerating economic growth and public welfare of the country.
  7.  The top 5 sectors (by estimated value) capture ~83% of the aggregate pipeline value. These top 5 sectors include: Roads (27%) followed by Railways (25%), Power (15%), oil & gas pipelines (8%) and Telecom (6%)[19].
  8. In terms of annual phasing by value, 15% of assets with an indicative value of ₹0.88 lakh crore are envisaged to be rolled out in the current financial year (FY 2021-22)[20]. However, the aggregate, as well as year-on-year value under NMP, is only an indicative value with the actual realization for public assets depending on the timing, transaction structuring, investor interest, etc[21].
  9. A range of instruments is identified through which assets and transactions identified under the NMP are expected to be rolled out[22]. These include direct contractual instruments such as public-private partnership concessions and capital market instruments such as Infrastructure Investment Trusts (InvIT) among others[23].
  10. Union Budget 2021-22 had identified monetization of operating public infrastructure assets as a key means for sustainable infrastructure financing[24].

EFFECTS OF ASSET MONETISATION

Privatization of assets will lead to the following outcomes: –

  • Through the way of consumption or investment, privatization will lead to paring down of government instead of a further increase in government expenditure.
  • Efficacy of asset use is improved through lower real interest rates to spur private investment.
  • All the money that comes from asset monetization will go back to the government via a circuitous route.
  • Asset monetization will not result in any addition to the gross domestic in the economy, either by bringing in foreign savings or by attracting a significant synergy premium.
  • Asset monetization doesn’t add up to the share of resources available to the private sector and does not contribute to the growth of the private sector even by a penny.

In conclusion, the idea of selling existing government funds to create new ones is excellent. But in the current situation, there is no such thing, and speaking of the economy as a whole, there will be no other changes except transaction costs go up, and a severely limited government bandwidth is further stretched thin over needless paperwork.


[1] Sonali Ranade, ‘How Will Asset Monetisation Help the Government?’, The Wire (August 26,2021) < https://thewire.in/economy/how-will-asset-monetization-help-the-government> accessed 27th August 2021.

[2] Ibid.

[3] Ibid.

[4] Ibid.

[5] Ibid.

[6] Ibid.

[7] Ibid.

[8] Ibid.

[9] Ibid.

[10] Ibid.

[11] Ibid.

[12] there will be no other changes except e, th of the private secto even by a penny.  Ibid.

[13] Ibid.

[14] Ibid.

[15] Ibid.

[16] Ibid.

[17] Ibid.

[18] Ibid.

[19] Ibid.

[20] Ibid.

[21] Ibid.

[22] Ibid.

[23] Ibid.

[24] Ibid.

IMPACT OF COVID-19 PANDEMIC ON CRIME RATE

By Moksha Grover

The Covid-19 outbreak in Wuhan, China was recognized as a pandemic by World Health Organization (WHO). Today, the world is in the fight towards covid wide-ranging consequences. Pandemics have always changed the way human beings interact and covid pandemic is no exception in this case. People are facing collective forms of trauma due to health concerns, negativity caused by the pandemic, loss due to unemployment, false information surfing around social media etc.  Isolation and quarantine increased depression and anxiety among the people. Because of the side effects of the pandemic faced by the people domestic violence, homicide crimes, fraud and trafficking of medicinal products have increased significantly. While, due to lockdown crimes like theft, and robbery has shown a decline.

Domestic physical violence, abuse. Scared little caucasian girl, victim sitting close to a white wall with the shadow of an angry threatening mother with alcohol addiction. Awareness of social problems.

DOMESTIC VIOLENCE AND HOMICIDES CRIME

While the covid pandemic has affected all types of crimes, some crimes have increased and some decreased. It has affected domestic violence and homicide crimes the most. Pandemic has added to the rise in domestic abuse and homicide crime. Due to economic reasons, the victim is forced to remain with the abuser. Some victims get quarantined with the abusers and are prone to sexual assault, partner violence, and child abuse. These people are also left without any access to services.

During the lockdown, many women were trapped in their houses and had to work all day and also become the victims of domestic violence by their husbands.  A study in New Delhi, India shows that by the second week of lockdown domestic violence cases rose from 116 in the first week to 257 in the final week in the month of March[1].  A study by researcher Priyanshi Chauhan found that “approximately 22.5% of married women, as compared to zero men and unmarried women, worked for more than 70 hours per week” during the lockdown[2]. The study also said unemployed women witnessed the highest increase of 30.5 percentage points for those who spent more than 70 hours per week on unpaid work[3].

COUNTERFEITING AND FRAUDS

Counterfeiting and fraud have increased a lot in this covid pandemic. High-demand products during the pandemic, mostly medical products are being counterfeited the most. Virus mitigating products such as face masks, virus test kits, PPT kits etc. worn by frontline workers and medical supplies used for treating COVID-19 patients were also counterfeited. In India, due to the shortage of remdisivir vaccines used for treating covid patients, criminals started selling fake remdisivir injections to people and in return took huge amounts of money from these people.

As the covid-19 pandemic led the way for online shopping, countering in online shopping also rose. Criminals began to exploit a greater use of social media as a medium for sales. The public trusts celebrities and influencers, promote a product and have faith in their recommendations. But this benefit was recognized by criminals and they recruited irresponsible influencers to engage in building interest in cheap and often dangerous fake goods. The covid pandemic is making a way for criminal counterfeiters and increasing the threat to businesses and consumers alike.

CYBERCRIMES

Owing to the shift of focus to a health crisis, cyber defence systems have been lowered. As a result, cybercriminals are attacking the computer networks and systems of individuals, businesses and even global organizations. Cybercriminals have created thousands of new websites for conducting spam campaigns or spreading malware. Various covid-19 maps and websites have been found embedded with malware, spyware and Trojans. Hospitals, medical centres and public institutions are being targeted by cybercriminals for ransomware attacks – since they are overwhelmed with the health crisis and cannot afford to be locked out of their systems, the criminals believe they are likely to pay the ransom[4].

TERRORIST ATTACKS

In comparison with the past, terrorist attacks have been reduced due to the global lockdown. In the past, when in 2013, the emergence of the Islamic state brought a new wave of attacks 2014 in cities around the world[5]. This wave of ISIS terror attacks seems to come to an end now. However, “Coronavirus denier movements” could contribute to the potential of violence since they attracted extremists from various ideological backgrounds[6]. In 2021, may a series of attacks in Afghanistan resulted in the deaths of 56 people[7]. Today, Afghanistan has been conquered by Talibans and now Talibans in association with Al-Qaeda have attacked Panjshir valley, a fight ongoing for two days[8]. Switzerland has warned of terror attacks on Covid vaccine sites[9].

THEORETICAL REASONS FOR THE IMPACT OF COVID-19 ON CRIME

Overall covid-19 pandemic has resulted in the reduction of crime rates. More stringent restrictions over movement in public spaces due to lockdown have resulted in large declines in crimes like theft, burglary and other types of crimes.  There are mainly 4 causes that have led to a significant decrease in crime rates due to pandemics.

First, restrictions on mobility and reduction in economic and social activities outside of the household leave the criminals with fewer opportunities. These restrictions have also reduced the number of assaults with deadly weapons, robberies, residential burglaries, shoplifting, and thefts as a consequence of a reduced interaction of people in the urban environment. Furthermore, this pandemic has also led to a reduction in the opportunities for potential victims to encounter the potential offender

Second, due to the fear of infection, many criminals have become hesitant to engage in criminal activities. This cause has shown a consequence in the reduction of group crimes. Even if the lockdown is not imposed there are many criminals who do not engage in criminal activities due to the fear of infection.  Various studies propose that the lockdowns specifically lower crimes that are committed in groups. But more severe crimes like homicides fail to decline.

Third, due to the economic problems caused by the pandemic crimes can relatively increase. Individuals losing employment, income, lack of new public policies, weaker public support systems, and a larger informal sector can result in to increase in the willingness of criminals to commit crimes.

PREVENTING CRIME AND KEEPING SAFE DURING COVID-19

Covid-19 has affected the whole world in many ways including the type and number of crimes being committed. Along with focusing on the health crisis, it is the right time now to take steps that can help in the reduction of crime rates to ensure the safety of the people. Here are a few steps that can be taken to reduce crime rates.

  1. Talking about the risk factors associated with crime, our focus should be shifted towards socially vulnerable areas where there is often a combination of risk factors such as high levels of unemployment, mental ill-health and drug and alcohol abuse.
  • Alcohol consumption should be reduced as it can lead to domestic violence and child abuse when stress increases.
  • For reducing cybercrime, people should be taught about the precautions they should take to protect themselves from cybercrimes. These include setting a strong password, updating software, managing social media settings, using a full-service Internet security suite etc.
  • Appropriate policy measures can help a lot in overcoming fraud and counterfeiting of the products.
  • Having a proactive approach and spreading awareness can also help a lot. We should treat violence as a public health concern to ensure the protection of the people.

CONCLUSION

In conclusion, I would like to say that, although covid pandemic has decreased overall crime rates. However, Covid has not caused a reduction in all kinds of crime nor in all countries across the globe. There are some types of crimes that have increased due to covid pandemic and there are some countries that have seen an increase in crime rates. The focus should be given equally to crime around the world as to pandemics. People should be taught about the precautions they need to take. The world should stand together and fight against all the terrorist activities taking place in this covid pandemic


[1] Bismee Taskin, ‘Increased work, domestic abuse — how Covid lockdown was especially hard on women in India’, The Print (9th February,2021) < https://theprint.in/india/increased-work-domestic-abuse-how-covid-lockdown-was-especially-hard-on-women-in-india/601328/> accessed 3rd September, 2021

[2] Ibid.

[3] ibid.

[4] ‘COVID-19 cyberthreats’, Interpol < https://www.interpol.int/en/Crimes/Cybercrime/COVID-19-cyberthreats> accessed 3rd September,2021.

[5] ‘Timeline: the Rise, Spread, and Fall of the Islamic State’, Wilson centre (28th October,2019) < https://www.wilsoncenter.org/article/timeline-the-rise-spread-and-fall-the-islamic-state> accessed 3rd September,2021.

[6] Thomas Wahl, ‘Council Conclusions: COVID-19 Impact on Terrorism and Violent Extremism’, Eucrim (6th July,2021)< https://eucrim.eu/news/council-conclusions-covid-19-impact-on-terrorism-and-violent-extremism/ > accessed 3rd September,2021

[7] Greg Barton, ‘n COVID’s shadow, global terrorism goes quiet. But we have seen this before, and should be wary’, The Conversation (14th August,2020) < https://theconversation.com/in-covids-shadow-global-terrorism-goes-quiet-but-we-have-seen-this-before-and-should-be-wary-144286> accessed 3rd September,2021

[8] ‘Afghanistan Crisis Updates: Al-Qaeda reportedly joins Taliban in attack on Panjshir valley, fight ongoing for two days’, The Economic Times (05 September, 2021) <https://economictimes.indiatimes.com/news/newsblogs/latest-daily-news-and-updates-september-02/liveblog/85854590.cms > accessed 5th Septembter,2021

[9] ‘Switzerland warns of terror attacks on Covid vaccine sites’, Mint (29th August, 2021) < https://www.livemint.com/news/world/switzerland-warns-of-terror-attacks-on-covid-vaccine-sites-11630226544056.html> accessed 5th September,2021

INDIAN PHARMACEUTICAL INDUSTRIES IN THE TIMES OF COVID-19 PANDEMIC

By: Moksha Grover

As the whole world is suffering against the covid-19 pandemic, pharmaceutical industries all over the world are trying their level best to fight against these unprecedented times. The covid pandemic has actually benefitted the pharmaceutical industry and helped in the growth and development of this industry. The Indian pharmaceutical industry is the world’s third largest drug producer by volume and the country’s market manufactures 60 percent of vaccines globally[1]. This constitutes 40 to 70 percent of the supply to satisfy the World Health Organization’s (WHO) demand for Diphtheria, Tetanus, and Pertussis (DPT) and Bacillus Calmette Guerin (BCG) vaccines and 90 percent of the global demand for the measles vaccine[2]. In this covid pandemic, the Indian pharmaceutical industry has played a vital role in distributing affordable and low-cost generic drugs to millions of people around the globe.

GROWTH AND DEVELOPMENT OF INDIAN PHARMACEUTICAL INDUSTRIES

The covid-19 pandemic presented several opportunities for the pharmaceutical companies and helped them to think differently. It helped them to act in a sense of urgency for all the patients who were looking for cheap and affordable medicines. In this pandemic, Indian companies have risen and developed in the field of therapeutics by re-purposing the dugs.

This pandemic also gave the pharmaceutical companies opportunities to work in collaborations with some major global companies for the purpose of developing the covid vaccine in turn enhancing the global connections. Serum Institute of India partnered with Oxford University, Zydus Cadila partnered with Gamaleya Institute of Russia, Panacea Biotec collaborated with US-based Refana Inc and there are many other companies who collaborated for the purpose of producing good and effective vaccines against the deadly virus. These collaborations and partnerships helped the companies to make effective vaccines, develop a stand in therapeutics, and also reach the global market.

Indian pharma industry took a proactive approach during the pandemic and also became successful in proving its mettle in complex and specialty generics. These companies also ensured regular manufacturing by not hindering manufacturing even for a single day. With the development in the pharma industry, eCommerce platforms and industries also developed. In the current pandemic, a great deal of motivation was given to E-pharmacy which helped in ensuring that patients received their medication despite lockdown. The domestic pharma market turnover in India has reached Rs. 1.4 lakh crores (equivalent to $ 20.03 billion) in 2019 as per the government data[3]. This is actually an increase from Rs. 1.29 lakh crores in 2018[4].

CHALLENGES FACED BY INDIAN PHARMACY INDUSTRIES DUE TO PANDEMIC

The source of APIs plays a very crucial role in the strategic plan of the Indian pharmaceutical industry to combat covid-19. A major challenge faced by this industry is the supply of APIs. Active Pharmaceutical Ingredients (API) are defined as the active ingredients contained in a medicine. This pandemic has highlighted the dependence of the Indian pharma industry on imported APIs. Today, 60 percent of India’s API requirement is imported[5]. In commonly used APIs, such as cephalosporins, azithromycin, and penicillin, the dependence is as high as 90 percent [6].  Of the total imports of APIs and intermediates into India, China accounts for 65–70 percent [7]. This is a problem faced by almost the whole west depends upon china for their API supplies. This pandemic has also highlighted low healthcare coverage in India. n terms of healthcare spending, India has one of the lowest healthcare budgets with just 1.26 percent of GDP being spent on healthcare[8]. India ranks 155th out of the 167 countries in terms of hospital bed availability (as per the Human Development Report 2020) with just five beds available for every 10,000 Indians[9].  Such a sudden rise in covid cases in India highlighted the shortage of hospital beds, medicines, and availability of laboratory tests. As pandemics have always shifted the way people react. A similar change has been seen in the consumption pattern of various consumers. There has been an increase in the case of online ordering and e-consultations, especially in the case of chronic diseases. These challenges can result in long-term impacts on this industry.

STRATEGIES FOR PROMOTING INDIAN PHARMA PRODUCTION

Initiatives like Production Linked Incentives (PLI) schemes for bulk drugs and medical devices introduced by the government for the industry’s self-reliance have given a major boost to this industry. These incentives are to the tune of INR6,940 crore and INR3,420 crore, respectively, and encompass greenfield projects for bulk drugs and intermediates, and the establishment of three bulk drug parks[10]. In addition to this, the government should take some steps in removing the financial and technical barriers prevailing within this industry. This will in turn help in reducing the dependency of the Indian pharma industry on china for APIs.

The pharmaceutical companies have now identified the importance of backward integration which is expected to bring greater reliability, improve the quality of production, reduce dependence on external sources of supply, and help in increasing the efficacy of manufacturing. Several key representatives from the pharmaceutical industry and NITI Aayog have suggested fostering the approvals of pharmaceutical infrastructure developments, clearance from the environment ministry, and providing tax exemptions and subsidies for the development and promotion of the pharmaceutical industry hubs could benefit the market[11].

Over the last few years, many tourists have been visiting India for their medical treatment. The government has also relaxed rules for the tourists by issuing rapid airport clearances and fast-track medical visas, thus helping in the promotion of this industry.

CONCLUSION

This covid pandemic has been a boon to the Indian pharmaceutical industry. Medicine spending in India is expected to grow between 9-12 percent over the next five years, leading India to become one of the top 10 countries in terms of medical spending[12]. It is now important for all pharmaceutical companies to shift their product portfolio toward chronic diseases like covid drugs, antidepressants, anti-diabetes, cancers, etc. which are on the hike nowadays. Many initiatives have been taken up by the government to reduce healthcare expenses and make it affordable for the whole population of the country. The introduction of generic drugs has also paved the way for the benefit of pharma companies. It is now important to focus on the rural healthcare system and provide the rural areas with the necessary drugs and preventive vaccines. Doing so will help a lot in the development of pharma companies in India and will also lead to the development of the country as a whole.


[1] Dr Abhishek Dadhich, ‘The COVID-19 pandemic and the Indian pharmaceutical industry’, EPR (22 April,2020) < https://www.europeanpharmaceuticalreview.com/article/117413/the-covid-19-pandemic-and-the-indian-pharmaceutical-industry/> accessed 19th September 2021.

[2] Ibid.

[3] Dr Sujith Varma K, ‘Covid-19 impact on Indian pharmaceutical industry’, PHARMABIZ.COM (10th February, 2021) < http://www.pharmabiz.com/ArticleDetails.aspx?aid=135427&sid=9#:~:text=The%20domestic%20pharma%20market%20turnover,actually%20an%20increase%20from%20Rs.> accessed 19th September,2021.

[4] Ibid.

[5] Sanjay Singh, ‘Pharmaceuticals: emerging not just stronger, but better and smarter’, KPMG https://home.kpmg/in/en/home/insights/2021/04/indian-pharma-industry-boom-mantra.html accessed 19th September,2021.

[6] Ibid.

[7] Ibid.

[8] Ibid.

[9] Ibid.

[10] Ibid.

[11] Dr Sujith Varma K (n 3)

[12] Ibid.

HOW DOES THE STOCK MARKET WORK?

By Moksha Grover

Are you scared of investing in the stock market too? Have you heard of people losing all their money by investing in the stock market? If it is so, then you are not alone. There are many individuals with limited experience who are scared to invest in stocks after hearing the horror stories of investors losing 50% of their portfolio value[1]. The reality is that investing in the stock market carries some amount of risk. But it is one of the best methods to increase one’s net worth if carried out in a disciplined manner. Today, most rich and affluent people have the majority of their wealth from investment in stocks.  

WHAT IS THE STOCK MARKET?

The stock market is where investors connect to buy and sell investments — most commonly, stocks, which are shares of ownership in a public company. ` When you purchase a public company’s stock you get entitled to the stock ownership of that particular company that is you become a shareholder. Stock ownership implies that the shareholder owns a slice of the company equal to the number of shares held as a proportion of the company’s total outstanding shares. For instance, an individual or entity that owns 100,000 shares of a company with one million outstanding shares would have a 10% ownership stake in it.[2] Most companies have outstanding shares that run into the millions or billions[3]. Anyone with a brokerage account can easily buy stocks online through the stock market. Most of the stock trades take place between investors. If we buy shares of a company, we are not buying these shares from the company itself. We are buying shares of another investor who has decided to sell his shares.

TYPES OF STOCKS

There are mainly two types of stocks that are common stocks and preferred stocks.

COMMON STOCKS

Common stock is a security that represents ownership in a corporation. Holders of the common stock vote on corporate policies and elect the board of directors. Common stock is further classified on the basis of voting rights. The basic proposition of common shares is that they should have equal rights –one vote per share system. But some companies have multiple classes of stocks, wherein each class of stock has different voting rights. In such a dual-class structure, Class A shares, for example, may have 10 votes per share, while the Class B “subordinate voting” shares may only have one vote per share. Dual- or multiple-class share structures are designed to enable the founders of a company to control its fortunes, strategic direction and ability to innovate[4].

PREFERRED STOCKS

Preferred stocks are a class of stocks that are granted rights different from common stocks. They usually have higher claims over dividends and asset distribution. Preferred stocks have limited or no voting rights in corporate governance. Preferred stocks have more priority to investors than common stocks as they possess characteristics of both bonds and common stocks.

HOW THE STOCK MARKET WORKS?

The stock market works in a very simple and easy way.  In a stock market, buyers and sellers negotiate the prices of stocks and make trades. This process is carried out with the help of a network of exchange. When companies list shares of their stock on an exchange then this process is called Initial Public Offering or IPO. Investors buy and sell stocks among themselves. The supply and demand of stocks are determined by exchange networks like the New York Stock Exchange or the Nasdaq. Supply-demand helps to determine the price of the security. Price is determined by the investors and traders willing to buy or sell. Bidding by the buyer for the highest amount is done. The amount that the buyer is willing to pay is often lower than the amount sellers ask for. The difference in the amounts is called the bid-ask spread. The bid-ask concept is not much of a concern for beginner and long-term investors as the amount differs by pennies.

The working of the stock market is a fascinating example of the law of supply and demand, in real-time. If there are more buyers than sellers, then the price of stocks trends up. If there are more sellers than buyers, then the price falls down. The stock market serves two very important purposes both for the companies and the investors. For the companies, the stock market helps to raise funds from the public and helps in their funding operations. It also helps in the development and growth of the company and further expands its projects and business. As the companies grow and expand their business, shares bought by investors become more valuable, thus helping them to gain more capital. In addition to this, investors also receive dividends from the company as their profits. Public companies selling their shares need to disclose all the material information required and also give a say in how their business works to the investors.

All these processes that help in the working of the stock market seem to be complicated, but in reality, these have become relatively easy with the help of computer algorithms that help in price-setting calculations. Bid, ask and bid-ask all are available on the broker’s website with the required information. Today, the stock market is considered to be one of the most reliable ways of making money.

WHAT IS THE STOCK MARKET DOING TODAY?

Anyone can look at the performance of the stock market with the help of market indexes like the S&P 500 or the DJIA. Previously, when the covid-19 cases in India were at a hike, the stock market fell drastically. But now, in the current scenario around 3.2 per cent of the 1,216 listed companies on the National Stock Exchange that have reported their June quarter earnings have managed to defy the odds by expanding their operating margins on a sequential basis for four consecutive quarters[5]. In India, currently, there are 40 stocks that are defying a widespread trend[6].

HOW TO INVEST IN THE STOCK MARKET?

  1. Decide the kind of account which you want to open: –

The first step to investing in the stock market is to decide the kind of account you want to open. Investment accounts can be opened for anything ranging from short-term goals to long, retirement savings to college savings etc.

  • Open a brokerage account: –

After deciding the kind of account you want to open, you have to open an account at a provider called a brokerage. When you choose a company, do look at their fees and available investment opportunities.

  • Depositing Money: –

To further continue with the investing process, you have to make an initial deposit. You can also set up recurring deposits to automate your investments going forward.

  • Choose your investments: –

Once you are done with the above-mentioned steps. You can buy and sell securities. You can take up mutual funds, exchange-traded funds (ETFs), individual stocks and bonds etc. These include hundreds of individual securities. It is recommended to have a diversified fund-based approach as it reduces the risk of losses and bad investments.

  • Purchasing chosen investments: –

After choosing what you want to buy simply enter the ticker symbol in the buy field and indicate how many shares you want to buy.

STOCK MARKET VS STOCK EXCHANGE

The stock market and stock exchange are two very different things but they are often interchanged with each other. The stock market is a wider term than the stock exchange. In fact, the stock exchange is a part of the stock market. The stock market includes many stock exchanges such as the Nasdaq or New York Stock Exchange (NYSE) in the U.S and NSE – National Stock Exchange in India.

We might have heard people talking about the performance of the stock market. When they talk about performance they mean thousands of public companies listed on multiple stock exchanges. In general, too stock market is a very broad term which comprises all the terms like mutual funds, ETFs, bonds and other securities beyond just stocks.


[1] Adam Hayes, ‘How Does the Stock Market Work?’, Investopedia (1st June 2021) < https://www.investopedia.com/articles/investing/082614/how-stock-market-works.asp&gt; accessed 1st September 2022

[2] Ibid.

[3] Ibid.

[4] Ibid.

[5] Chiranjivi Chakraborty, ’40 Stocks that  are Defying a Widespread Trend in India Inc right now, The Economic Times (1st September 2021) <https://economictimes.indiatimes.com/markets/stocks/news/40-stocks-that-are-defying-a-widespread-trend-in-india-inc-right-now/articleshow/85822852.cms > accessed 1st September 2021

[6] Ibid.

WARREN BUFFET- A MODEL FOR HIS BILLIONAIRE PEERS

By Moksha Grover

Warren Edward Buffett is an American business magnate, investor, and philanthropist. He is currently the chairman and CEO of Berkshire Hathaway.  Born in Omaha, Nebraska in 1930, Buffet is 91 years old. He is one of the most successful investors of all time and a model for his ultra-rich peers. Buffet also runs Berkshire Hathaway, which owns above 60 companies, including insurer Geico, battery maker Duracell and restaurant chain Dairy Queen.  He has a net worth of over $104.4 billion as of August 2021, making him the world’s ninth-wealthiest person[1].  “If you don’t find a way to make money while you sleep, you will work until you die” is a famous quote said by Warren Edward Buffet.

EARLY LIFE AND CAREER

Warren Buffet displayed his interest in business and investing at a very young age. At age seven, he was inspired for investing in the book “One Thousand Ways to make $1000”. Much of buffets childhood was filled with business ventures. He sold chewing gum, Coca-Cola bottles, and weekly magazines door to door. When in high school, he made money delivering newspapers, selling golf balls and stamps etc. As a sophomore, with one of his friends, he established a large paper route and invested in pinball machines. They are stationed in barber shops and split their profits with the shop owners. They started their business with just $25 and sold their business later for $1200. Buffet also bought 40 acres of Nebraska farmland, by age 15 with the proceeds from earlier business ventures[2].

After completing his graduate degree from Columbia University, Buffett worked for the investment legend Benjamin Graham, in New York City. He considered Benjamin Graham as his mentor and was inspired by him a lot. After Graham retired from his business, buffett went back to his hometown and started running a series of successful hedge funds, known as the Buffett Partnerships.

In late1960s, Buffet closed down his original investment business and took over Berkshire Hathaway, a struggling textile maker. He decided to close his business when he saw the stock market being overvalued and made Berkshire Hathaway his primary business activity. Over the decades, with the help of buffet, Berkshire Hathaway turned into a conglomerate with annual sales of $245 billion[3]. It has a market capitalization of $654 billion and employs roughly 360,000 people through its many subsidiaries[4]. With the rise in the value of Berkshire’s stock, many people became rich. Buffet declared employee Greg Abel as his successor, keeping in mind his age-related health risks and long-term, interests. Although buffet has not retired or declared his intention to retire from Berkshire Hathaway. Its shares gained about 25% in the first eight months of 2021[5].

Image source: IndiaStudyChannel.com

LIVING LIFE ON HIS OWN TERMS

Buffet got much of his philosophy from his father, Howard Buffet, who was an American businessman, investor, and politician. He describes this philosophy as trying to “keep up with the Joneses.”. This means that he enjoys living up his life on his own terms and doesn’t care about what others think of him.

Talking about buffet’s personal life, Although, Buffet is a Democrat, he has still voted and donated to both democrats and republicans. He has also described himself as an ‘agnostic ‘person. His late wife and the foundation named after her that he has funded, the Susan Thompson Buffett Foundation, were and are substantial supporters of reproductive rights organisations that favour access to legal abortions. Warren Buffet married Susan in 1952, who spent her later years in San Francisco. He spent more than 20 years considering himself to be happily married to Susan. After his first wife’s 2004 death, Buffett married another woman named Astrid Menks, who lived in Omaha, at the same time in a small and informal ceremony.

WARREN BUFFET’S CHARITY

Warren Buffet became the founder of ‘The Giving Pledge along with Bill and Melinda French Gates. The Giving Pledge is a campaign to encourage extremely wealthy people to contribute a majority of their wealth to philanthropic causes. Buffet also pledged that more than 99% of his wealth will go to philanthropy, either during his lifetime or at his death[6]. He could have started his own charitable foundation but has contributed his money to five foundations run by others.  Until 2021, he served Bill & Melinda Gates Foundation as a trustee and poured most of his charitable money into the foundation.

Buffet says that he has given very little money to his three children Howard Graham Buffett, Peter Buffett and Susan Alice Buffett, who themselves are millionaires and own hundreds of millions of dollars for the foundations they each run. For example, he’s one of corporate America’s strongest proponents of women in business. He mentored Tracy Britt Cool for more than a decade as she rose from a financial assistant to CEO of Pampered Chef, a Berkshire subsidiary. Later, she started her own private equity firm, modelled after Berkshire, with Buffett’s support.

Buffet also shared his knowledge of the financial markets and the economy in 1977 and conducted annual shareholder meetings.[7] His annual shareholder meetings, known as “Woodstock for capitalists” is akin to a Disney vacation for thousands of families each year. Buffett also voluntarily met with scores of college students for decades about eight times a year for a Q&A session and tour of his businesses[8]. Buffet has given more than $4.1 billion to charity[9].

BUFFET’S RULE

Buffet recently admitted that he pays tax less than his secretary. The reason behind this, he told is a system from which he has benefitted a lot. This system lets billionaires pay very low tax bills, partly because it taxes income instead of wealth. For years he advocated for the so-called “Buffett Rule,” a minimum 30% tax on those making more than $1 million a year to remedy the problem[10]. Rich pay less tax when they deduct it from what they have donated to charities is a fact, also recognized by the buffet.

 For his rules on business, Buffet is a very sensible investor. He only invests in those companies which he has thoroughly researched and understands. Buffett personally lost about $23 billion in the financial crisis of 2008, and his company, Berkshire Hathaway, lost its revered AAA rating[11]. The most important quality, as defined by buffet for an investor is temperament, not intellect. For a successful investor, being with or against the crowd is not the centre of attraction.

Buffet was inspired a lot by the book “The Intelligent Investor” by Benjamin Graham as it inspired and convinced him to invest in stocks. With the help of this book, he got to know that investing in stocks is equal to owning a piece of the business. So, when Buffet searches for stock to invest in, he always prefers the business that exhibits favourable long-term prospects. Buffet never buys anything unless he can write a particular reason to pay a particular price for that shares of the company and advises all the investors to do the same.

“Leave the children enough so that they can do anything but not enough that they can do nothing” is a famous quote said by buffet to wealthy families for charitable purposes.


[1] John M.Longo, ‘Why Warren Buffett Is a Model for His Billionaire Peers’, The Wire (August 30,2021) < https://thewire.in/business/why-warren-buffett-is-a-model-for-his-billionaire-peers> accessed 30th August 2021.

[2] Ibid.

[3] Ibid.

[4] Ibid.

[5] Ibid.

[6] Ibid.

[7] Ibid.

[8] Ibid.

[9] Ibid.

[10] Ibid.

[11] Stephanie Loiacono,’ Rules That Warren Buffett Lives By’, Investopedia (Jan 12,2021) < https://www.investopedia.com/financial-edge/0210/rules-that-warren-buffett-lives-by.aspx> accessed 30th August,2021.

BITCOIN VS GOLD: WHAT IS THE FUTURE OF INVESTMENTS?

By Moksha Grover

Today, most people have shifted their focus toward investments for the purpose of strengthening their financial position. While there are many ways to strengthen one’s financial position, investment is considered to be the most apposite way. The covid pandemic has taught us a lot about different aspects of life. However, most importantly it has highlighted our way of savings and investments. During tough phases like lockdown, almost everyone suffered financially and was forced to make compromises within their lifestyle. Only those who made wise money decisions at the right time were left uncompromised.

During the pandemic, it was observed that more and more people started investing in safe-haven assets. The most popular safe-haven investment during the covid pandemic has been gold. Gold investments, as we all know, are said to give good returns most of the time. It is also viewed as one of the safest options for investments. However, nowadays, investment in gold is being challenged by cryptocurrencies. Cryptocurrencies are now being regarded as the new hot cake in the world of investments and are said to give even more returns than gold. The most trending and successful cryptocurrency is Bitcoin.

WHAT IS BITCOIN?

Bitcoin is termed a digital currency which is free of any central control or the oversight of banks or governments. Instead, it depends upon peer-to-peer software and cryptography. It is also known as digital gold because its properties are very similar to that of gold. Like gold, bitcoin too has a fixed supply and derives its value through its limited supply and growing consumer demand. Some of the pros and cons of this cryptocurrency are: –

PROS

  • Since bitcoin is entirely digital, it can be easily sold a transferred to another person’s account.
  • Bitcoin has the potential to give higher returns on investments because of its growing market.
  • Bitcoin can be used as a currency everywhere. It can be used for payments at any store that accepts bitcoin.
  • Investing in bitcoin now could lead to big payoffs down the road. Because bitcoin is an emerging investment and has the potential to increase in value.

CONS 

  • There is a greater degree of risk involved in bitcoin as it is extremely volatile and susceptible to large fluctuations.
  • Bitcoin is subjected to scams or stealing as it is completely digital and so web-based wallets have the possibility to be hacked.
  • Bitcoin’s value is totally dependent upon the phenomena of demand and supply. If the demand for other cryptocurrencies increases more than the demand for bitcoin, its value can decrease.

WHAT IS INVESTMENT IN GOLD?

Gold is a valuable yellow metal and is used for various consumer goods such as jewellery, and it is not in abundance. Gold is a must for all the special occasions in India ranging from weddings to other special functions. In fact, one of the largest markets for gold is found in India. Gold has a big significance in the country’s cultural value and is considered to be a store of value, a symbol of wealth and status and a fundamental part of many rituals. Investment in gold gives fruitful results most of the time. Some of the pros and cons of Gold investments are: –

PROS

  • Investment in gold is always a stable option as its value increases over time; even if the economy gets into recession, its value will not decrease.
  • If you have your gold stored in a precious metals IRA, it will be stored in a specific, safe vault that is overseen by a custodian who will manage your account. These accounts are often insured up to a certain amount, much like a traditional bank account, so you can rest easy knowing your investment is safe[1].
  • Gold is considered to be an ideal baseline for trading purposes and is being used up as long as civilizations have been around. So it is durable in nature.

CONS

  • Gold can be used as a currency only during an economic crisis. It cannot be used as a currency to buy something in normal times.
  • When you invest in gold you need to keep that physical item stored carefully and safely.

DIFFERENCE BETWEEN BITCOIN AND GOLD

CHARACTERISTICSBITCOINGOLD
Legality, Transparency and safetyBitcoin has safety issues and is not that transparent and legalGold ranks above bitcoin in safety, legality and transparency.
VolatilityBitcoin is extremely volatile. It is more susceptible to market whims and newsGold is a safer asset and is less volatile
Baseline ValueBitcoin has less baseline value as it is based on a full banking system and many people don’t have access to online banking services.As gold is used in a variety of ways, therefore, it has more baseline value than bitcoin.
RarityRareRare
LiquidityLiquidLiquid

WHICH TYPE OF INVESTMENT SHOULD BE CONSIDERED? GOLD OR BITCOIN

According to billionaire Ray Dalio, bitcoin is just a digital version of gold but he prefers physical gold over bitcoin. “If you put a gun to my head, and you said, ‘I can only have one,’” says Dalio. “I would choose gold.” Here’s why he prefers investment in gold over bitcoin[2].

  • Gold has thousands of years of historical record as a store value and doesn’t face the same competition risks as bitcoin has
  • Unlike bitcoin, gold is very less volatile. Its volatility is just one-fifth of the volatility of bitcoin.
  • Cryptocurrencies can never replace metals like gold and silver as they are being used for centuries in every corner of the world and have a very strong economic standing as compared to bitcoin. So Cryptocurrencies like bitcoin can only help increase the value of these metals but cannot replace them.
  • Gold has offered a very high degree of longevity but such degree of longevity offered by bitcoin is highly questionable.

FINAL VERDICT

Both bitcoin and gold have their own advantages and disadvantages. For now, it is very hard to predict whether an investment in gold will result in better returns or investment in bitcoin. Bitcoin, today is said to be giving more returns than gold. It is alleged that Bitcoin’s market cap will surpass gold’s market cap by 2030. However, nothing is for sure now. Many people prefer gold investments, at the same time many people have shifted towards investments in bitcoin. Bitcoin has a fantastic upside and limited downside, while gold has a more traditional risk-reward balance[3]. Bitcoin is good for short-term investments and getting high returns on it and gold is good for long-term investments and gives relatively lower returns than bitcoin. It is completely the choice of the investor regarding the kind of investment he/ she wants to take up. An investor can invest in bitcoin or gold or in both. It is completely the choice of the investor. But it is advisable to invest in both bitcoin as well as gold as it will help you diversify your investments and increase your chances of high returns.


[1] ‘BITCOIN VS GOLD: WHICH IS BETTER?’, NATIONWIDE COIN & BULLION RESERVE < https://nationwidecoins.com/bitcoin-vs-gold-which-is-the-better-investment/> accessed 11th September 2021

[2] Jade Scipioni, ‘Bitcoin vs. gold: Here’s what billionaire Ray Dalio thinks, make it (4th August 2021) < https://www.cnbc.com/2021/08/04/bitcoin-vs-gold-heres-what-billionaire-ray-dalio-thinks.html> accessed 11th September 2021

[3] Ravi Singhal, ‘Gold vs Bitcoin: Which one is a better option for investment?’, The Economic Times (8th August 2021) <https://economictimes.indiatimes.com/markets/cryptocurrency/gold-vs-bitcoin-which-one-is-a-better-option-for-investment/articleshow/85148997.cms?from=mdr accessed 11th September 2021