GOVERNMENT RESTRICTS EXPORTS OF DIAGNOSTIC KITS

The government put a curb on diagnostic kits on Saturday, April 4th. The decision was announced by the directorate general of foreign trade. The curb only allows those with a license to export diagnostic kits, earlier there were no restrictions on the export of this good. This measure was put into effect immediately.

This measure comes after the number of coronavirus cases have been growing at a very fast rate in the world's second largest populated country, even though the country has been under a complete lockdown for more than a week, the rise in cases have been massive.Testing kits are very important for any nation and demand is nearly inelastic for these kits, these kits are needed to test patients for coronavirus. As spoken about in our post earlier, these kits are a necessity.

Exporting these kits are helpful for the economy, however only if they are in excess. If India continues to export these kits without meeting the demand in its home country, the situation would only become worse. The government could choose to continue allowing the export of this good and improve its balance of trade, but however choosing to curb these exports shows that the government surely chooses the well being of its citizens first. However, some kits can still be exported and the money earned from adding duty on these goods will help the government increase its revenue which can be invested back into healthcare and research of the global pandemic- Covid-19 as well as invest the money into better technology or hire more labourers in order to increase the supply of these kits.

Image Source - en.wikipedia.org

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