Dealing with "Failed to load plugin 'react' declared in '.eslintrc': Cannot find module 'eslint-plugin-react'" ESLint error

I had the same problem in VS code. Add the following settings in VS code ESLint settings:

{
  "eslint.workingDirectories": [
    "Dir1",
    "Dir2"
  ],
  "eslint.validate": [
    "javascript",
    "javascriptreact",
    "typescript",
    "typescriptreact",
  ]
}

Note: Dir1 and Dir2 are two directories with their respective .eslintrc files.