SYED JESARAT

Srinagar, May 27: While the COVID19 pandemic created havoc across the world, affecting the economy and businesses throughout the globe, India – one of the worst-hit countries by the coronavirus – has to face an economic recession after decades as the GDP for 2020-21 is expected to contract by more than 7 percent. However, the businesses in Jammu and Kashmir have to face a double whammy. First, it was the August 5, 2019 clampdown and internet ban, and as people here were struggling to come out of its impact, a countrywide lockdown was announced to curb the deadly virus. This year also as the second wave of COVID19, which proved worse than the first one, hit the country, restrictions were again put in place for the movement of people as well as the opening of markets, educational institutions and public places hitting hard the already beleaguered business. To know the impact of these back to back lockdowns on the Kashmir economy, Business Kashmir spoke to some businessmen and industrialists about their assessment of the situation.

Kaisar Ahmad Khan

Al-Furqaan Enterprises

Trade & Distribution sector

My company is going through a financial crunch. We provide stock to our retailers but most of the payments remain withheld. We have about 10 employees working with us, who are dependent on the firm. We have to pay salaries to our employees as well as rent of godowns, which makes it even more difficult to cope with the loss.

The trade sector is hugely impacted by the COVID19 pandemic and prior lockdowns as well. Due to prolonged lockdowns, consumer buying power has gone down. Even those people who have money are only buying essentials and deferring bigger purchasing decisions as the situation is unpredictable.

The government needs to take some concrete steps to facilitate the business sector. Refinancing of loans and interest subvention is of no help to businesses like ours. The situation is like that we have to start it all from scratch now because Kashmir has witnessed three lockdowns consecutively. Government should come up with a good package that will deal with business as well as present the COVID19 situation simultaneously.

Dawar Mir

MA Mir and Co.

Govt Contractor

COVID19 pandemic has resulted in halting major construction activities. While the construction material prices have shot up by more than 35%. Be it gravel, sand, cement or steel, all items are now costlier as compared to the rates before August 5, 2019. But the government rates are locked until the completion of a project and as the work gets delayed due to lockdowns, it takes away the profitability.

I believe, the industrial sector is witnessing a 90% loss, since the business is not going well we still have to pay the workers which drain the capital. Though during the present phase of lockdown, passes have been allotted to the industry people. But these passes are not many times entertained by the lockdown enforcing people on the ground.

Though the government has a lot of policies on paper regarding industry and business, all they need to do is implement those policies, which is not happening. Development funds are delayed, and payments are pending for the last 3 years. If the government implements the policies there might be some respite from the misery of losses.

Ibrahim Beigh

5G Mobile Services

Cell Phone sale& Service 

COVID19 pandemic has affected the daily work of our firm badly. Mine is a product-based as well as a service-based business. Due to COVID curfew and lockdown, the official store at Khanyar is closed. The business is run through online mode now and delivered to customers through logistics service providers which have impacted the sales as the footfall has reduced to a significant amount in our retail store. The online platforms cannot compensate for that. Economic scenario has deprived to a large extent and spending power of people is very low compared to what it is in normal conditions.

There is no display of mercantile in the retail store, owing to present circumstances, all sales are generated online right now. We are offering free delivery within adjoining areas and paid delivery in farther areas.

The business is witnessing a 50-60% dip in sales on average because of the current lockdown.  The store has 5-6 employees, all working on a commission basis presently, no salary structure is being applied for now.

Kashmir’s economy has been disturbed since 2014 itself, due to natural as well as political conditions, keeping in view all these factors and knowing this is the third consecutive lockdown, the administration should strike a balance between pandemic as well as business and ease restrictions for businesspeople to some extent.

Certain leniency should be provided to businesses, as holistic lockdown will halt the economy completely. The opening of markets should happen in a phased manner under a particular controlled mechanism.  Society has hand-to-mouth segments of people as well who are solely dependent upon the small businesses they own, keeping that in view the stringent standards of lockdown should ease to some extent.  Also, the administration needs to facilitate the smooth movement of delivery persons, as it’s not easy for them to move freely during such stringent lockdown.

Sheikh Samiullah

FastBeetle

Logistics & Courier Services

FastBeetle has witnessed good growth during the ongoing lockdown. People want all the essential to get delivered to them at their doorsteps, which boosted the logistics business. This sector of business has seen a significant amount of profit.

The mobile application makes it very easy for people to place an order. The company has employed 35 people till now and is doing very well.

Kashmir has witnessed several lockdowns which have resulted in less economic growth. There are other sectors of business that have got severely affected due to the lockdown. Government officials should come up with some relief packages for business sectors so that the ongoing losses can be compensated.

The movement of delivery persons during the COVID curfew is a matter of concern. Their movement is usually restricted, and they are even beaten most sometimes, but somehow they manage to deliver the orders by following Covid- SOPs.’

Daniyal Qureshi

Greenway Enterprise

Packaging Industry

The current lockdown has resulted in a decline in production at our factory.

Initially, the movement was not allowed from home to factories, then the administration ordered movement passes to people in estates but on grounds, the situation was quite opposite. Since the markets were closed, the buyers were not ready to accept the products which affected the product generation. Even though the factory was closed, the payment to labourers and utilities needs to be paid. The production made is zero but banks are continuously charging the interests from the firms.

Since there is no sale, we are not able to generate any money, what will we pay to a bank? Because of this, our EMIs are continuously piling up.

Currently, Greenway Enterprise has seen a 30% dip in production generation. The national lockdown has resulted in an escalation in prices of raw materials as well. Presently, losses are being assessed, and it can be said that the current state of Kashmir’s economy is not viable.

Government should come up with effective policies to compensate for the losses.

With proper implementation of COVID19 SOPs, markets should be at least opened alternatively.

Government should consider a proper plan of 5 years for rehabilitation, revival and restructuring of the business sector. The economy is under crunch and 40% – 50%  capital infusion will not help in reviving the market.

Asif Hussain

Fair Fax Holidays

Tour & Travel

Tourism sector is one of the worst-hit sectors in Kashmir. Except for a brief period of 2-3 months, tourism activities have remained suspended in Kashmir since August 2019.

The employees working with us are very badly impacted. To sustain we provide them with a salary but at the same time, everyone wants to see growth in their job, which unfortunately can’t be achieved in Kashmir.

The tourism sector saw a boom for the winter month for a while, at a winter sports event in Gulmarg and in April, at tulip festival opening. So, keeping that in view many investments were made beforehand but due to the sudden rise in Covid cases and imposing of lockdown, all the investments are in a loss. The graph of tourism has seen improvement only for two times since three consecutive lockdowns it’s in decline mode.

Forget about gaining, even to sustain markets are not open.

Hotels, restaurants are all shut since lockdown and the earning is zero in the tourism sector.

The expectations of the tourism sector now lie with the Amarnath Yatra, which is supposed to get functional in July.

The objectivity is lacking in Kashmir’s trade and commerce sector. The state has no backup plan, even after witnessing many unstable conditions. The government is not taking any solid steps to help the people who went through huge losses.

The administration should frame policies that can be implemented on grounds keeping in view the Covid-19 SOPs.  It seems that we have to live with COVID, for now, so the strategies to sustain the economy should be made very effectively. Government should start home-based projects for youth who are unemployed and can’t find work due to the pandemic.

Firdaus Bhat

Manchester Education Consultancy Services

Service Sector

COVID19 has badly impacted us, as almost every country is dealing with it right now. Travel and movement in many parts of the world are either banned or restricted. Earlier, it would be lockdown in Kashmir and students would like to go outside for the studies but this time situation is the same everywhere. So the kind of service we provide, overseas education, is completely down and my venture is running in losses. I have to pay the salary to my employees regularly.

Not only the educational consultancies but overall the education sector is in losses. But despite that, I’ll argue that lockdown should continue until it is required to rein in this deadly virus. Health should be a priority for everyone.