Potential Impact of Maharashtra Lockdown:
A Care Ratings' report suggests that imposing lockdown in Maharashtra could have an economic impact of Rs 40,000 crore on India’s economy.
This decline in output would effectively lead to a dip in Gross Value Addition (GVA) by 0.32% in the overall economy. The report also suggests that the hotel industry will be worst affected if the lockdown is imposed in Maharashtra. This sector is poised to bear a loss of Rs 15,772 crore. It is likely to be followed by financial services, real estate, and professional services which will see a loss of Rs 9,885 crore.
Maharashtra is the largest state in terms of Gross State Domestic Product (GSDP), accounting for roughly 15% of the GVA. Naturally, any harsh lockdown in Maharashtra will impact productivity at the national level. The state has been impacted hard by the second COVID wave. And, it is contributing nearly 60% to the overall COVID-19 cases.
Restaurant Owners Disappointed with Fresh Curbs:
The Maharashtra government has introduced new restrictions in order to combat the increasing number of COVID cases. The government has declared night curfew, and weekend lockdowns till April 30. Under the new notification, malls, restaurants, and bars will be allowed to operate only for takeaways and parcels.
These fresh curbs will again bring down the entire hospitality sector to a standstill. It will nullify all the little recovery that the sector has seen so far. In the words of Shivanand Shetty, President, Association of Hotels and Restaurant, measures to fight the pandemic are turning out to be far more hard-hitting than the pandemic.
Under the effect on COVID, the industry is going through a rough time since last year. Many smaller players are wiped out as consumers remained wary of returning to crowded places.
With new restrictions in place, the hotel industry has now urged the state government to either allow them to operate for normal hours or compensate its employees, suppliers and landlords for the loss of business.
India Flexing its Muscles in the Oil Market:
OPEC's decision to reduce oil production in midst of rising crude prices has not gone down well with India. Indian has been working on developing alternative sources of supply. And, it is expected to buy 36% less oil from Saudi Arabia in May.
The refiners like Indian Oil, BPCL, HPCL cumulatively buys 14.8 million barrels of Saudi oil in a month.
Relations between India and Saudi Arabia have turned soured as OPEC continued to ignore India's concerns. India is the third-largest oil importer. With Saudi Arabia not paying attention to its needs, India has chosen to flex its muscles.
The Indian government had advised its refiners to develop alternative sources to reduce dependency on Saudi Arabia. Working on this tactic, Indian refiners have started to import oil from non-OPEC countries like Guyana to meet their energy needs.
