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India coronavirus: Recession looms as economy reopens
Jun 3, 2020
India is gradually unlocking its economy after a shutdown that lasted more than two months. But it's unlikely to be business as usual for millions of retailers, small enterprises and factories, writes the BBC's Nikhil Inamdar.
By all accounts, reversing the disruption caused by India's lockdown will be a long haul - and the price businesses, especially small firms, have paid is just starting to become clear.
“At least 20% of neighbourhood mobile shops that sell smartphones may never reopen again,” says Arvinder Khurana, president of India's mobile retailers association.
The reasons are many, he adds - on the one hand, owners have fled the cities and are yet to return, and on the other, with job losses mounting and banks averse to offering consumer loans, there is no demand for high-end phones.
According to India's retail association, sales of non-essential items - such as clothes, electronics, furniture - fell by 80% in May. Even sales of essential goods - such as groceries and medicines - dipped by 40%.
Image copyright Getty Images Image caption Businesses are reopening even as demand is low
The near future looks uncertain as infections rise - India has recorded nearly 200,000 cases so far, with several record single-day spikes in the last week.
But the government is yet to announce uniform procedures for businesses that are reopening - so sales are expected to slide further down, even as high-street shops, malls and other commercial markets are scheduled to reopen next week.
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