India's export sector could lose nearly 15 million jobs amid the lockdown due to fast-spreading coronavirus pandemic, the Federation of Indian Export Organisations (FIEO) told the government. The sector also asked the government to release an economic package since it's facing pressure due to the cancellation of orders. With the cancellation of 50 per cent of the export orders, the sector is also expecting a rise in non-performing assets (NPAs), Sharad Kumar Saraf, President, FIEO also said. The government should also provide for COVID-19 interest-free working capital term loan to the exporters so as to cover the cost of wages, rent and utilities, the export body added.
The production units should be allowed to work with minimum labour to complete the pending orders, else many of the units may see irreparable losses in the coming days, FIEO added. On Wednesday, the World Trade Organisation (WTO) said that global trade is likely to deteriorate by 13 per cent to 31 per cent in 2020 due to coronavirus pandemic. FIEO also asked the government to give exports a waiver from paying into Employees' Provident Fund Organisation (EPFO) and Employees' State Insurance Corporation (ESIC) funds for 3 months, from March to May.
Meanwhile, the economy is expected to lose nearly $100 billion during the 21-day lockdown due to coronavirus, Acuite Ratings said in a report. Each day of the shutdown may cost the economy more than $4.5 billion, the report added. In the last week of March, Prime Minister Narendra Modi announced a three-week complete lockdown of the country until April 14 to prevent the spread of coronavirus. Q1FY21 GDP is expected to see a risk of contraction to the tune of 5 per cent to 6 per cent with Q2 also likely to record a muted growth, the rating agency also said.
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