“With revenue at Indian retailers selling non-essential items such as apparel and jewellery taking a huge hit, it will inevitably result in job losses of close to 8 million people involved in organised and informal retail,” Kumar Rajagopalan, CEO, the Retailers Association of India (RAI), said.
The retail industry is staring at losses of about half a billion dollars due to the closure of malls, apparel stores and the recent decision to pull shutters on factory production due to the havoc created by the coronavirus, the Retailers Association of India (RAI) said.
RAI represents 500,000 stores in India, including brands like Madura Fashion, V-Mart, Shopper’s Stop and Future Group. Demand for non-essential items have plummeted as people stock up food, bracing for a prolonged lockdown.
Only 25% of India’s retail landscape is organised, employing about six million people, while the remaining employs the bulk of the 30 million. Any job loss would have a deep impact on the sector which has been going through a period of challenge over the last one year due to weak demand in a slowing economy. RAI had asked the government to consider providing a moratorium of 120 days from banks on all interest payment up to the end of June, besides allowing banks to give out 25% additional working capital credit lines at subsidised rates till September.
“We expect this problem to sustain for about six months for the retail industry as even if the impact of this disease dies down in the next two months, consumers will not immediately throng to the stores,” Rajagopalan added.