Longer lockdown would hit retail industry hard
Chennai: Around 20 lakh employees of modern retail stores will lose their jobs if the lockdown continues for three months. The job losses in the unorganised retail may run into crores, say trade bodies.
“Retail stores have been operating at 80 per cent less than average sales. Now that the country is in lockdown, the stores will remain closed. If the closure continues for three months, retailers will lose up to 50 per cent of their revenues,” said Kumar Rajagopalan, the CEO of Retailers Association of India (RAI).
According to him, it will take at least two to three months for the sector to get back into shape even after the virus subsides and the total impact would be 50 per cent loss of annual revenues.
This in turn would affect the jobs in the sector and almost 20 lakh people or more than 30 per cent of the 60 lakh people employed in the sector, would lose their jobs.
The unorganised sector, which employs 45 crore people, too will have to suffer if the same situation persists.
“If the situation continues only for a few days, the retailers will be able to absorb the losses. But if it continues for a month or more, people will start losing jobs," said Praveen Khandelwal, secretary general of Confederation of All India Traders (CAIT).
The industry body has asked government to provide 50 per cent job subsidy to retailers.
“As per the formula, government can pay 50 per cent of the wages, 25 per cent will be borne by the retailer and the employee will forego the remaining 25 per cent,” said Khandelwal.
The industry body has also asked the government to provide 90 days of grace period for depositing all statutory dues, like Income Tax, Advance Tax, GST, ESIC and PF, moratorium on bank loans, letter of credit and purchase bills, additional working capital credit and relaxation on NPA reporting guidelines.