The coronavirus has taken a massive toll on India’s retail and trade with one in every two businesses feeling the heat of the outbreak.
The coronavirus has taken a massive toll on India’s retail and trade with one in every two businesses feeling the heat of the outbreak. With over 50% businesses expecting a high impact on operations even at early stages, an even bigger number of businesses are staring at huge order reductions, according to a survey undertaken by FICCI. “Almost three-fourth of the businesses indicate big reductions in orders. Of these, almost 50% indicate a 20% and more decrease in the orders,” the report said. With rising inventories, the cash flow of the businesses is highly impacted and organisations have said that there is almost 80% drop in cash flow.
As the outbreak has now taken the shape of a pandemic and as countries start closing economies, there has been a major supply chain disruption. China is one of the major suppliers of key raw ingredients to the country but the supplies have dried up with China shutting down its economy, a trade body had earlier said. According to the FICCI survey as well, 60% businesses indicate that their supply chains were affected. The impact of the pandemic on the supply chain is expected to worsen further and a majority of the respondents feel that the situation would come under control by six-months.
Meanwhile, Prime Minister Narendra Modi has taken stock of the impact of coronavirus and the threat it poses to Indian economy and said that a ‘COVID-19 Economic Taskforce’ will be constituted soon to assess the impact of the outbreak, he said in his address to the nation on Thursday night. The taskforce will come under the ambit of the Finance Ministry and will be supervised by Finance Minister Nirmala Sitharaman. He added that the taskforce will work on the feedback received from various state governments. Certain industries such as aviation, hospitality and restaurants are anticipating major blow to revenues as coronavirus leads to shut down of various public spaces.