Retail sector loses a whopping Rs 5.50 lakh cr since lockdown; around 20% traders may pull down shutters, says CAIT

The coronavirus-induced lockdown may spell not only the loss of jobs in many sectors but also lead to the downsizing of many. Traders body, CAIT said the retail trade may see many more traders pulling down shutters as the sector has become unviable. The Confederation of All India Traders (CAIT) said on Tuesday that, ever since the lockdown was imposed on 24 March, the retail sector has lost approximately Rs 5.50 lakh crore and is likely to witness at least 20 percent of Indian retailers collapse and wind up their businesses in the next few months.In light of the same, the CAIT has urged Prime Minister Narendra Modi & Finance Minister Nirmala Sitharaman to handhold the trading community and award a substantial package to the traders to ensure their survival. CAIT National President BC Bhartia and Secretary General Praveen Khandelwal said that COVID-19 has caused a huge irreparable dent in retail trade which will have a devastating effect on the whole country. Retailers do a daily business of around 15,000 crore and the country is in a lockdown for over 40 days now. This would translate to around a a massive loss of over 5.50 lakh crore of business carried out by around 7 crore traders since lockdown-25 March to 30 April, 2020. Of these 7 crore traders, in all likelihood around 1.5 crore traders will have to permanently down the shutters in a few months and a further 75 lakh traders who are dependent on these 1.5 crore traders will fold up in the medium term, it cautioned. [caption id=“attachment_7149881” align=“alignleft” width=“380”]  Representational image. Reuters.[/caption] Bhartia and Khandelwal said that at least 2.5 crore traders in India are micro and small in nature who do not have deep pockets to sustain this severe economic catastrophe. They do not have enough capital to continue their operations in a scenario where their shops are shut for such a long period. On the one hand they have to pay salaries, rentals, other monthly expenses and on the other they will have to deal with a sharp dip in disposable income of consumers along with strict social distancing norms which will not allow business to return to normalcy for atleast 6-9 months. The Indian economy is passing through a recessionary phase and there is a significant downturn in demand across sectors. CAIT blamed the government for ‘completely abandoning and ignoring the plight of the traders’.  It said the sector contributes over 40 percent to India’s GDP and accounts for almost one-third of the total workforce of the nation. Instead, the government has given ‘diktats’ that all businesses will have to pay their salaries, the banks will continue to charge interest and the landlords will continue to ask for rentals, CAIT said. “This is a complete one-way traffic where the Government only expects from traders but has offered absolutely nothing at all till date,” the CAIT said. CAIT claimed that only 20 percent of its member shops in permitted category could open in different states due to confusion and lack of clarity over interpretation of neighbourhood shops and standalone shops at local levels. Bhartia and Khandelwal also said that the various notifications by the Home Ministry that have not helped the situation on the ground level. “There is no synchronisation between the Centre and States in implementing the guidelines. The Indian retail sector is literally on a ventilator mode and without the immediate intervention of the Government which is by and large responsible for this chaos, the sector will suffer unprecedented damage. The economic pandemonium will be even bigger than the corona pandemic,” CAIT cautioned.