The coronavirus outbreak and the subsequent country-wide lockdown has deeply impacted India’s economy, with a majority of the firms expecting a significant decline in revenues, falling demand and job losses, according to a CII CEOs Snap Poll. The online survey saw a cross-country participation of around 200 CEOs across sectors.”The survey results indicate that a significant majority of the firms expect revenues to fall more than 10 percent and profits to decline more than 5 percent in both the current quarter (Apr-Jun 2020) as well as the preceding quarter (Jan-March 2020).
“The expectations of this sharp decline in both revenue and profit growth by domestic firms could foretell the significant impact of this outbreak on GDP growth,” CII stated.
On the jobs front, about 52 percent of the firms foresee job losses in their respective sectors, resulting from the impact of the coronavirus outbreak and the ensuing lockdown. While the proportion of jobs that are expected to be cut are quite staggered, a significant proportion of the firms (47 percent) expect less than 15 percent of job losses, while 32 percent of the firms expect to shed about 15-30 percent of jobs once the lockdown ends. Further, most firms (80 percent) claimed that their inventory was lying idle at present.
However, more than 40 percent of the firms expect their stocks to last beyond a month once the lockdown ends — indicating their expectations of a demand slowdown in the post lockdown period.
According to the survey, a majority of the firms engaging in the production of essential products and the supply of ancillary goods are facing constrained operations during the lockdown. Firms have revealed that access to manpower and movement of products have emerged as major constraints in essentials trade, be it manufacturing or warehousing and transport or retail sales of these essential commodities.
While the government has allowed manufacturing, transportation and distribution of essentials, the enforcement at the local level has implemented the lockdown on essential commodities as well as services, said the Confederation of Indian Industry (CII).