COVID-19 crisis | Here's why orange zone is most crucial for the economy

The government has classified different parts of the country into red, green and orange zones based on the novel coronavirus, or COVID-19, cases in various districts. Those districts that come under the red zone have the highest number of COVID-19 cases, while those falling in the green zone have the lowest.

For over a month now, the country has been under lockdown, which was first announced by Prime Minister Narendra Modi on March 24. It was later extended until May 3, and again until May 17, in light of the rising number of infections being reported across the country. As of now, the number of COVID-19 positive cases in India has breached the 52,000 mark.

The zonal classification was hence done in order to assess which areas need a more stringent implementation of the lockdown.

As per a report by Motilal Oswal, the orange zone is crucial from an economic activity point of view as it accounts for a relatively higher share of both the population and the workforce of the country.

The report compiles macroeconomic statistics like population, bank credit, bank deposits, and labour market for all three zones.

Of the three zones, the orange, green and red zones accounts for 39 percent, 43 percent, and 18 percent, respectively, of the total districts in the country. As per the report, in mid-April, share of the orange zone has gone up, while that of the green and red zones has fallen.

Image: Motilal Oswal Report

Population-wise, the orange zone comprises 44 percent of India's population (using Census 2011 data), as per the report. Again, this zone also houses 41 percent of India’s employed population.

The orange zone holds 42 percent and 44 percent of ‘self-employed’ and ‘casual workers', respectively. The report specifies that on an aggregate basis, more than half of India’s workforce is classified as ‘self-employed’ workers (partnership firms, proprietorships, etc), followed by almost a quarter as ‘casual workers’, and the remaining 23 percent as regular wage or salaried workers.

Image: Motilal Oswal Report

Another point of significance is that the orange zone also "accounts for 45 percent each of agricultural and construction workers, the vulnerable working sections, in the country."