BCAS President CA Manish Sampat's Message for the Month of June 2020
This is the third consecutive month that I am writing to you from the confines of my home. It is almost unbelievable that the lockdown was announced more than 70 days ago. Who ever imagined that 2020 would be such a nightmare of a year for the entire planet? On an individual level there has been pain of loneliness, illness, fatigue, mental, financial and emotional stress for many victims of the virus and their family members. We must remain optimistic that these dark days will end sooner rather than later and we will be allowed to open up in a phased manner. However, one thing is very clear – life as we knew it till just a few months ago will change for the foreseeable future. We will all have to get used to what is being called ‘The New Normal’. As we all look at reopening our offices, social distancing, wearing of masks, increased emphasis on good hygiene practices, building our immunity and avoiding physical interaction will be of utmost importance. This highly contagious but not so fatal virus is not going to be beaten in a hurry; the onus is on us to protect ourselves and our loved ones by changing our habits and following certain rules.
INDIA TO UNLOCK AND BOUNCE BACK
With each passing day of the lockdown, the Indian economy is being dragged deeper towards a recession. Recently, two rating agencies cut India's GDP for the current year to minus 5%, equalling the dubious record low achieved 40 years ago. It is indeed a worrying situation and we are staring at difficult times. There is a global slowdown and we are amongst many countries facing a recession. India seems to be in a spot of bother because the structure of this recession is different and not comparable to anything we have seen in the past. India is facing a pandemic-induced recession, where the medical infrastructure is under severe strain with huge shortage of hospital beds and medical facilities. Some sectors are facing huge shortage of demand, such as hospitality, air travel, etc. So we need to handle the situation differently.
What is worrying is that in spite of the total lockdown for more than 70 days, our number of infected cases are not flattening or coming down; on the contrary, they are rising. It seems that the continuous total lockdown has impacted the economy very, very adversely. Has the lockdown been effective? Has it worked the way we wanted it? It seems it has not had the effect we were wishing for. What has happened due to the lockdown is that our economy has crumbled and has been almost crushed. In my view, the government has now taken the correct decision to open up and unlock the activities in a phased manner. We need to do the right things in the days to come and the government should shift the focus to creating awareness on hygiene and how to live with this virus. This virus is not likely to go away in a hurry and has to be managed without panic and hysteria.
I remain very optimistic about our capabilities, abilities and power to bounce back. Our recovery rate is rising and mortality rate due to Covid-19 remains very low as compared to other countries. We are a resilient and self-reliant nation and I am sure that once we reboot our economy, both domestic and global investors and capital will flow back into our economy. Let us also play our part in restarting the economy in whatever way we can. Let us start our economic activities in earnest because little drops of water make a mighty ocean. If we start consuming, demand will go up, exchange of money will lead to rolling of working capital which, in turn, will lead to investment and overall growth will return. In these times, the sheer size of our population and our domestic demand has the capability to inject the much-needed stimulus into our economy.
Let us stand up once again on our feet, not overreact to fear and at the same time learn how to live in the changed environment.
Take care, stay safe and go digital!
CA. Manish Sampat