This Diwali season, smiles are back in India as Covid-19 recedes

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After unprecedented gloom that hit India around April-May this year when the second Covid 19 wave peaked, this Diwali seems to have brought back the spark amid a continued drop in the new cases of the virus and recovery in the economy. And pent up demand is driving consumption like never before.</p>
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“My business was absolutely down..it was shut for months as we had no customers. We even had to borrow money from friends and family but now with people switching back to normal life, our sales have shot up since the end of September,” an owner of a restaurant in the outskirts of Kolkata told India Narrative. He added that the post second wave sales have been enough to wipe out the earlier losses. </p>
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Rough estimates indicate that consumer spending has touched 80 per cent of the pre-Covid phase bringing back smiles on the faces of millions of small to medium entrepreneurs and business outfits.</p>
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India’s gross goods and services tax (GST) revenue for October touched Rs 1.30 lakh crore — the second highest collection since the introduction of the tax system. In April this year India recorded GST collections of Rs 1.41 lakh crore – the highest ever—driven by year-end payments.</p>
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“This is just the beginning..in the coming years, once the Covid situation is totally under control, their businesses are expected to grow further,” Praveen Khandelwal, secretary general, Confederation of All India Traders (Cait), said.</p>
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Khandelwal said that the severe liquidity crunch that had hit the retail segment is gradually easing.</p>
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“By the end of this financial year, we are hoping to go back to the pre-Covid times,” Khandelwal added.</p>
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Now consider this: Sales of lights—the most important and a must-buy item have crossed Rs 7,000 crore. Until 2020, about 80 per cent of these lights have typically been imported from China.</p>
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But the outbreak of the pandemic and the Galwan valley clash changed the dynamics. As imports of low value products from China declined, businesses of thousands of Indian manufacturers categorised as small and medium, have boomed.  </p>
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The Indian cottage industry, which had been facing severe competition from the low priced Chinese goods, has finally got the much required boost as demand for made-in-India lights, household items, gifts and FMCG items among other things has risen significantly in the last one year.</p>
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The nationwide restrictions and lockdowns in April-June owing to the Covid 19 second wave caused a loss of about Rs 15 lakh crore to India’s domestic traders and retailers. Of this Rs 9 lakh crore loss has been borne by retail traders and about Rs 6 lakh crore by the wholesale segment.</p>
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Meanwhile, India has already administered 106 crore Covid 19 vaccines. More than 32 crore people in India are now fully vaccinated.</p>
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For Health Minister Mansukh Mandaviya the immediate challenge will be to ensure that India does not get into the grip of a third wave after the festive season, which has seen people lowering their guard.</p>
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“People have been thronging the market places, malls and restaurants. Many of them have not adhered to the Covid protocols, which is a cause for concern..the next few weeks will be critical for India,” an industry body insider said.</p>