Impact of Covid-19 on different sectors

Updated on : 2021-May-08 19:30:13 | Author :

 

Impact of Covid-19 on Top Businesses

INTRODUCTION:

 

The Corona Virus or COVID-19 is a family of viruses that cause a range of illnesses in humans including the common cough and cold and severe forms like SARS and MERS which are life-threatening. This pandemic has impacted the economies around the world like no other event. It has a negative repercussion on them massively. Due to this Covid-19 pandemic world’s most powerful economy, the US has been reported a massive number of job losses.

 

India too stands on an equal state. It is proven that India’s GDP projection for FY21 to 0.8 percent. India is facing a very tough time since many sectors have been closed when the virus created the storm and hit hard. This virus has become a cause of ending several businesses. If not all, the key sectors that hold a larger portion of India’s GDP have been taken partially out of action. CMIE data shows that the unemployment in India spiked in the month of April and it has been stated that if the situation shows no improvement in the next few months then it will turn up to worsen.

 

Here are the 5 sectors that seek urgent help and cooperation from other sectors better position amid the crisis:

 

MSME SECTOR:

 

The Micro, Small, and Medium Enterprises are the backbone of all Indian Sectors and makes an engagement with the manufacturing and export activities- the two key drivers of the Indian Business world. But due to the pandemic, almost all the MSME Sectors are reeling under crisis and have been shut down all the production activities. The MSME sector contributes over 30% of India’s GDP and the report says that the majority of small shops may have to shut the business if they do not get a relief package soon. As almost a third of the planet was in lockdown and due to the shortage of trade and shrinking sales, the MSME sector is going through the burden of loans, repayments, GST filings, etc.

 

TRAVEL & HOSPITALITY SECTOR:

 

With no vaccine at present to fight against this deadly virus, the imposition of travel restriction and stay at home order has caused a severe impact on the service industry. Global and interstate travel has been stopped, restaurants and hotels have been shut down except for daily needs and basics. The nationwide lockdown leads to a complete stop on travel and tourism. Several reports indicate that the tourism sector has been deadly affected due to this pandemic. The report says that the Indian tourism and hospitality sector to lose more than over 3.8crore jobs which means 70% of the workforce. It is clearly proven that as the world faces the biggest pandemic in a century thus the tourism and hospitality sector will take a long time to regain its past position.

 

AVIATION INDUSTRY:

 

It started with ghost planes and ending with ghost airports. Coronavirus has made a horrifying impact on the Aviation industry. Globally it has left the airlines not only liquidity issue and highly indebted but also has led to closure some. During the second week of October 2020 (post lockdown) the number of daily scheduled flights worldwide has decreased by 46.4% in comparison with October 2019. This industry is facing a loss of around ₹75- ₹90crore on a daily basis. The global aviation sector is witnessing a flurry of layoffs and pay cuts along with a ₹5lac crore loss and 4-5crore job losses.

 

AUTOMOBILE SECTOR:

 

The automobile industry had already gone through a considerable slowdown over the past 18-20months starting with GST to liquidity scratch and many more. And the COVID-19 pandemic made a multiplier effect on it. The industry has almost stopped manufacturing since March 24. With most of the plants shut, the big automobile companies have declared pay cuts. The automobile sector is interlinked with many other small industries that manufacture the key parts of a car. Many large automobile manufacturers are waiting for a decision from the government on the resumption of the dealership to resume the business.

 

REAL ESTATE SECTOR:

 

With all other industries, the Real Estate industry is facing a tough time due to the pandemic. Most of the projects have been put on hold for several weeks. It has significantly created an impact on the developer’s cash flow and project execution abilities. Real Estate business employs millions of migrant laborers and this lockdown has forced the companies to unemployed them. Hardly anyone of those laborers who work for daily wages has savings to see off the lockdown period. Though the government has urged employers to not cut wages the situation has left no other choice for the employers. The report says that the property sales have turned down 80% in major in eight major real-estate markets in comparison with last year and new launches suffer a drop of 75% in comparison with January 2020. Due to this pandemic situation, the overall residential demand has turned down 25% in comparison to 2019.

 

 

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