Covid-19 On Demand-Side – As per FICCI survey, tourism, hospitality and aviation are among the worst affected sectors that are facing the maximum brunt of the present Coronavirus pandemic. Closing of cinema theaters and declining footfall in shopping complexes have affected the retail sector by impacting consumption of both essential and discretionary items.
Consumption is also getting impacted due to job losses and decline in income levels of people, particularly the daily wage earners due to slowing activity in several sectors including retail, construction, entertainment and others, the survey stated.
Covid-19 On Supply Side – Large scale shutdown of factories and resulting delay in supply of goods from China have affected many Indian manufacturing sectors. According to the FICCI report, sectors like automobiles, pharmaceuticals, electronics, chemical products etc. are facing an imminent raw material and component shortage.
Besides having a negative impact on imports of important raw materials, the slowdown in manufacturing activity in China and other markets of Asia, Europe and the US is impacting India’s exports to these countries as well, the report added.
Impact Of Covid-19 On Financial Market – Greater uncertainty about the future course and repercussion of Covid-19 has also made the financial market extremely volatile, leading to huge crashes and wealth erosion, which in turn is impacting consumption levels, FICCI report said. One of the massive crashes of domestic equity market was seen on March 12, when following the trend of the global equity markets, both the BSE Sensex and NSE Nifty crashed by more than 8 per cent in a single day.
Growth Projections Revised Down – The Coronavirus pandemic has also pulled down India’s economic growth projections. Given the challenges that the businesses and people are facing currently, the Indian economy is most likely to experience lower growth during the last quarter of the current fiscal, the report claimed.
It is also being said that in case the spread of Coronavirus continues, India’s growth may remain subdued in the first quarter of FY 20-21 as well. Rating agency Moody’s Investors Service has revised down its growth forecast for India to 5.3 per cent for 2020 from its earlier estimate of 5.4 per cent made in February.
The number one thing is to focus on is employees and customers, keep them well, keep them employed and keep them mentally healthy.Brian Moynihan, CEO of Bank of America