We're living through an extreme nightmare of human civilisation. This generation of humanity will retain the bragging rights to narrate coronavirus tales to children and grandchildren for decades to come. But no story will be complete without a tinge of regret over the economic fallout, death, destruction and social consequences that entail.
Just as coronavirus ravages through countries, states, cities and villages around the world, India's decision to go for a nationwide lockdown may have been the best case scenario to prevent a severe outbreak in densely populated areas, including among the most vulnerable citizens in villages.
But most nations on Earth will pay an unimaginable social and economic price of the spread of virus. Depending on their reaction time - some more, some less. For instance, shrinking GDP is a certainty. Loss of output is a given. Loss of revenue is certain. Lower fiscal profitability or losses in firms are a given. And loss of jobs hinges on the timeline.
Just how long? That's a question up in the air right now as it depends on what it takes to break the cycle of transmission of the virus. Will it be just one 21-day cycle? Two? Or even three? The longer it gets, the more painful the outcome.
After all, that duration will decide whether a quarter of the fiscal is a write-off or two quarters. While a vaccine-based cure is about two years away, world GDP will shrink this fiscal. So will India's.
But as they say, never waste a crisis to push through a change!
Who recovers fast enough will depend on the resilience, the tenacity and resolve of the governments, the nation and its people. And of their microcosm in companies and their employees.
That's why this issue of BT is devoted to that one big question: What next after coronavirus?
Will Indian firms re-examine dependence on sourcing from China? Are there cost-effective options locally or internationally? World will look for alternatives to single source of supplies, including manufacturing. Are our firms up to the mark? Will it disrupt supply chains? Can our economy capitalise?
Entrepreneurs, venture capitalists, bankers and CEOs will have the luxury of time to mull over these during the 21-day lockdown. Companies and industries are readying strategies to hit the ground running when the lockdown is lifted. Chemicals industry aims to diversify sourcing and reduce dependence on China; in aviation, fleet additions would be gradual, and mostly concentrated around profitable metros, expat pilots may have to give way to domestic staff; hospitality will re-examine its cost structure to stay a lean, mean machine; IT firms, in particular, will aim for opportunities in Covid-ravaged sectors such as hospitality, aviation, travel, manufacturing and energy and utilities as against their traditional core focus areas of BFSI, retail and telecom, besides others.
If WFH does become the new norm as predicted, several industries, particularly IT firms, will free up expensive office spaces to cut cost drastically. How contracts are structured will be reviewed and new enabling clauses will be inserted.
And what do you do in the stock market after it has eroded nearly 30 per cent of market-cap since the peak in January? Rebuild a portfolio for the long term.
Look forward to the post-corona era! Lively, positive and full of energy?
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