The Japanese catastrophe by itself is awfully worrisome, but
when seen along with other recent global economic developments
like military action in Libya, expensive oil and sovereign debt crisis taking new
dimensions in peripheral Europe, the global economic scenario has become
indeed a matter of serious concern. This has increased the magnitude of
global uncertainties for the Indian economy and is proving quite a challenge.
According to the World Bank, earthquake and tsunami could cost the
Japanese economy up to $235 bn, equivalent to 4% of its annual output. But, in a
report on the Asia-Pacific region, the World Bank has said that
growth should pick up as reconstruction efforts accelerate. It said the
reconstruction could take as long as five years.
An earthquake measuring 9.0—the largest ever in the country's
history, equivalent in power to 30,000 Hiroshimas—was followed by a
tsunami that completely wiped out a number of towns and spread the debris of
destroyed towns miles inwards, killing as many as 14,000 people—the count
is still rising. Even as the scale of horror was getting known, there came
another deadly blow—the earthquake and the consequent tsunami in turn
disrupted the functioning of the nuclear power plant at Fukushima 240 km north of
Tokyo. As a result, there have been explosions, fires and leakages of radiation
in the atmosphere. The latest reports indicate contamination of food and
milk. Lately, there has emerged a crisis of leadership too. The many-headed
catastrophe is pointing to deep-seated problems in the governance of Japan.
In the beginning, Prime Minister Naoto Kan maintained relative calm
despite the frightening situation at Fukushima Daiichi, the crippled nuclear plant.
His government was being seen as far more transparent than his predecessors'.
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