Biz In Tailspin As Virus Fear Kills Demand

From aviation to hospitality, businesses across sectors lose thousands of crores as curbs & lockdowns kick in

- Vivek Punj

Tourism, hospitality, aviation, transportation and restaurant businesses have ground to a halt nationwide as India braces for the third stage of the potentially intense Coronavirus outbreak since case zero on January 30.

While hospitality is projected to report over Rs 30,000 crore of loss of revenue during 2020, India’s aviation sector will report losses in excess of Rs 8,200 crore in the coming quarter as international and domestic flights stay grounded.

The brunt of these shutdowns will be borne by the unsuspecting employees across sectors impacting lives and livelihood. The National Restaurant Association of India has warned that even 10-20% job losses among its 7.3 million employees in restaurants across the country would mean up to 15 lakh unemployed. Something that would have severe social consequences!

Just as economies around the world have notched up Coronavirus war chest totaling nearly $3.5 trillion—bigger than the size of the Indian economy, Prime Minister Narendra Modi announced a Task Force to decide on an economic package for India as well. Meanwhile, apex industry association CII has sought Rs 2 lakh crore to be pumped into the Indian economy – as a stimulus to ride over the Covid-19 crisis.

According to Anurag Katriar, president NRAI (National Restaurant Association of India), layoffs in the restaurant business were inevitable as restaurants are seeing minuscule cash flow. At least, 40- 50% of the restaurants have been hit and if the lockdown continues, then the situation was bound to get worse.

“This is a crisis situation. In the restaurant business, 50% of revenue is used to cover the fixed costs. In the current situation, with restaurants shutting their shutters, there is zero cash inflow. In simple terms, the owner is paying from his own pocket to sustain, but very few will be able to carry on like this,” he said