FIVE GROWTH Covid-19 counts daily over the past seven days to 33,750 Monday, and new travel limits by provinces , suggests that the service sector will be under pressure and may decline if the number of cases continues to rise in the coming weeks. But this may be temporary.
According to the Google Mobility Index, visit stores such as restaurants, shopping malls, theaters, etc. November 3 – the day before Diwali – it was 13 percent higher compared to the pre-Covid foundation: the highest in 2021. Since then, metrics have declined and remained close to ‘0 ‘for most of December. With new pressure, a slide below zero is possible.
Similarly, visits to grocery stores and pharmacies, which were much lower by 40 percent in May 2021 during the second Covid-19 wave, recovered and lasted from June. The metric rose again on November 3 – 77% higher than its pre-Covid base – and has since stood between 33 and 55 percent. With so many services that require a lot of contact – from restaurants and hotels to supermarkets and cinemas – that are badly affected by the restrictions, it is expected to shrink in the coming days.
The basis is calculated as the average value for the corresponding day of the week over a period of five weeks between January 3, 2020, and February 5, 2020.
Another sign of slowdown is in the data of CMIE (India’s Economic Monitoring Center) with the unemployment rate affecting the four-month high of 7.9 percent in December 2021; it was 7 percent last month. in December 2020 changed to 9.1%. The unemployment rate in urban areas rose to 9.3 percent in December 2021 from 8.2 percent last month while the unemployment rate in rural areas increased to 7.3 percent from 6.4 percent, data showed.
The service sector grew healthy in the second half of the 2021 calendar year until mid-December; the latest tariffs on Goods and Services increased by 13 per cent annually in December (for sale November 2021) to Rs 1.29 lakh crore. This increase occurred despite a reduction in e-way bills generated at the same time – an indication of higher collections from resources than goods, accompanied by greater enforcement actions.
But over the past week or so, almost every major province – Maharashtra, Karnataka, Gujarat, Delhi, West Bengal, Haryana, among others – has become more economically active, reducing working hours in shops, restaurants and hotels, and setting economic time limits. the number of people at wedding events or movie theaters. With the service sector accounting for more than 55 percent of national GDP, economists say the limits will hurt growth, but not significantly.
“It will have a huge impact on services that need to connect with people. If the restrictions last for a few weeks, then there may be no significant impact on recovery, but if they persist for a long time it will not only be felt in the service sector but the impact will be felt on the assets side. Long-term restrictions on services will affect wages and employment levels, which will lead to a reduction in asset consumption. Local restrictions on areas such as roads, railways, etc. will also affect the cost of Central and provincial government as such organizations will need support despite declining operational capacity, “said Devendra Kumar Pant, Chief Economist, India Standards.
Nomura India said that although provincial borders could hamper the recovery of communications services in the first quarter of 2022, global knowledge had less impact than previous waves and rapid growth as cases increased. Soumya Kanti Ghosh, Group Group Economic Adviser for State Bank of India, also said the restrictions would affect the service sector. “The demand for the service sector – unlike commodities – will not be a waiting demand. , State Bank of India.
In December 2021, Delhi announced a 50 percent rate on the restaurant in terms of classroom spread Omicron is unique and allows them to remain open only from 8 a.m. to 10 p.m. Last week, the government ordered the closure of cinemas – which are considered to be hundreds of shopping malls, which has a negative impact on other facilities such as restaurants, shops, etc.
The West Bengal government has also ordered restaurants and bars to operate at 50 percent and until 10pm, until January 15. It has also introduced strict travel restrictions, as was the case during previous Covid-19 operations. It has blocked all flights from Delhi and Mumbai except Monday and Friday.
The Maharashtra government prohibits night travel and restricts restrictions on gatherings. In weddings, when the movement of people is disrupted, the number of attendees at any one time should not exceed 100 in confined spaces and 250 in open spaces to the sky or 25 percent of the total value of the hall, depending on the minimum. If there are social, political, or religious events and gatherings, include 100 attendees in confined spaces and 250 in open spaces to the sky or 25 percent of the space, depending on which is smaller. It also ordered restaurants, gyms, resorts, theaters and theaters to continue operating at 50 percent.