Covid-19 lockdown: The retail industry, which contributes around 40 per cent to India's consumption and 10 per cent to India's gross domestic product, is severely stressed.
The Retailers’ Association of India (RAI) on Sunday expressed disappointment with the ‘Atmanirbhar Bharat’ economic stimulus saying emergent issues facing retailers have not been addressed. The retail industry body also said that with “no income and zero support from the government”, retailers are staring at closure of businesses that would jeopardise livelihoods and jobs of 46 million direct employees, out of which 20 million work in non-essential retail. “The steps taken under the Atmanirbhar Bharat economic stimulus will help the country in the long term but the emergent issues facing the retail industry have not been addressed,” RAI Chief Executive Officer Kumar Rajagopnoalan said in a statement.
The retail industry, which contributes around 40 per cent to India’s consumption and 10 per cent to India’s gross domestic product, is severely stressed, he added. “What retailers needed was wage support; moratorium for payment of principal and interests and support in the form of working capital. This is critical for retail to survive,” Rajagopalan said.
He asserted that some earlier measures announced as part of the Rs 20-lakh crore economic package by Finance Minister Nirmala Sitharaman, such as reduction in TDS rates for payments or 2 per cent reduction each in the EPF contribution of both the employer and employee, are “minor measures that fail to provide the monetary support needed to keep a business functioning”. “Even the relief measures offered to MSMEs (micro, small and medium enterprises) by the government do not help retailers as retail is not covered under the MSME sector,” he said.
Reiterating that retailers need working capital in their hands to retain employment, Rajagopalan said, “Lack of support will result in closure of businesses, and jeopardise livelihoods and jobs of 46 million direct employees out of which 20 million work in non-essential retail.” He further said, “With no income and zero support from the government, the industry does not have the ability to support them.” This will lead to a massive slowdown in consumption that will further harm the economy and the country, Rajagopalan said.