MEETING THE DEMAND FOR SUPPLY
In ordinary times, the Indian transport and logistics sector sees perhaps 7.5 million trucks, 7,400 freight trains and scores of cargo planes criss-crossing the country every day, alongside millions of vehicles carrying raw materials to factories and goods to grocery shops, supermarkets and customers’ doorsteps. The Union government’s announcement on the evening of March 24 of an almost immediate national lockdown—beginning midnight that very night—brought all essential supplies to a dead halt. Realising soon, but perhaps not early enough, that this was a disruption India could ill afford, the Centre issued fresh orders next week to clarify that transportation of all goods—not even just essentials—would be exempt from the lockdown. But by now the human chain of skilled, semi-skilled and unskilled workers that keeps those wheels turning were returning in their droves to the sanctuary of their villages, raising the very real prospect of acute shortages in markets across India in the coming weeks.
This sudden seizure in the country’s economic body has also doubtless further impaired economic growth projections, with ratings agencies raising red flags soon after the lockdown was imposed. On March 26, Crisil slashed its growth forecast for India’s GDP in fiscal 2021 from 5.2 per cent to 3.5 per cent. On March 27, Moody’s Investors Service revised its estimate of growth in the current fiscal to 2.5 per cent, less than half its earlier projection. Experts say the pain will remain for several quarters to come, especially if the government is forced to extend the lockdown beyond the initial 21 days.
the situation on the ground. Participants included Reliance Industries chairman Mukesh Ambani, Kotak Mahindra Bank MD Uday Kotak and Tech Mahindra
