If the lockdown in India continues till June, the retail industry could be staring at 30% of stores shutting shop and 18 lakh people losing their jobs, says Kumar Rajagopalan, CEO of Retail Association of India.
By the end of February, business for retail stores had already dropped to as much as 20-25%. After the number of cases started increasing in India, business has further reduced to 15% in the past one and a half months, Kumar says. As per RAI estimates, there are over 15 lakh modern retail stores in India generating a business of almost Rs 4.74 lakh crore and employing over 60 lakh people.
â€śThere has been a significant impact on apparel, jewellery, shoes and CDIT (consumer electronics, Durables, IT and telephones) retail. Stores selling essential goods that have been allowed to remain open during the lockdown are also suffering losses as they arenâ€™t allowed to sell other general merchandise, which would otherwise bring them higher margins,â€ť Kumar says.
RAI has written to the government requesting for a relief package for the retail industry, similar to what governments in Singapore, UK and the US have announced for retail industries in their countries.
RAI has submitted representations to the Prime Ministerâ€™s Office, Department for Promotion of Industry & Internal Trade (DPIIT), the Commerce Ministry, and the Finance Ministry to help the retail industry cope with the detrimental effects on business in the wake of coronavirus pandemic.
With malls and retail stores across states having to shut down mandatorily, retailers face imminent financial crisis/insolvency. â€śAs a result, the livelihoods of millions employed in retail are in peril,â€ť RAI said.
Some of RAIâ€™s demands include wages subsidy, subsidy on utility bills, an extension of the due date of compliance and payment of statutory dues like Advance Tax, GST, ESIC, PF, etc. for payments falling due between March 1 and June 30, 2020.
The government recently announced some measures for the country, in a bid to help the poor and those badly hit by the economic fallout of COVID-19.
On Tuesday, the FM announced that companies which have a turnover of less than Rs 5 crore would not be charged interest, penalty or late fee. For companies with a turnover of more than Rs 5 crore, they would only be charged an interest rate of 9%.
The last dates for filing the returns of March, April and May have also all been extended to June end, the last of which will be June 30.