Industry leaders speak on the on the impact of the coronavirus pandemic on the Indian economy

March 14, 2020

The novel coronavirus disease (Covid-19) caused by the severe acute respiratory syndrome (SARS-CoV 2) has infected more than 100,000 people and caused the death of at least 5,400 people worldwide. With global restrictions in place for air travel, the economic impact is being felt on various sectors, which are directly or indirectly associated with travel and tourism. 

 

 

 

The Impact of COVID-19 on the Indian Hotel & Hospitality Sector:

 

“Business-wise, it will likely have an impact on the hospitality sector, especially on luxury hotels. Luxury chains have about 60-65% foreign travellers in their total guest composition and a large chunk of their business will potentially be impacted this season. Luxury hotel rates are also likely to decline in both quarter one and two as result. A full rebound may take time but we could see some recovery signs in the third quarter depending on the wider situation. Mid-scale brands on the other hand, derive more business from local tourists but even for those chains two quarters are going to be challenging as domestic travel restrictions come into force. Occupancies will be hit for sure but given the fluidity of this global situation, assessing the impact is a challenging proposition.”

 

— Jaideep Dang, Managing Director- Hotels & Hospitality Group, JLL

 

“The tragedy of novel coronavirus (COVID-19) has somewhat impacted the travel and hospitality industry in India in terms of travellers from China as it is one of India’s largest trading partner. There are many business travellers from China who go out on weekend trips from Delhi NCR to hills and other tourist destinations but recently we have witnessed a fall in queries from Chinese nationals and cancellations. However, it is a very small percentage of total travellers and we do not foresee any impact in medium to long term. Moreover, industry experts believe the worst of the outbreak is behind us as new cases are slowing down,” Ms. Preety Arora, Head - Business Strategy, Amatra Hotels & Resorts.

 

— Preety Arora, Head Business Strategy, Amatra Hotels & Resorts

 

 

The Impact of COVID-19 on the Indian Real Estate Sector:

 

“The COVID-19 situation remains fluid and uncertainty still looms on the possible economic impact of the outbreak. Global supply chains will be disrupted in the short-term and this will undoubtedly have some impact on manufacturing in India. At this stage, the UN estimates the trade impact of the epidemic for India to be a $348 million on the external front.” 

“Given that the real estate sector contributes significantly to India’s economic growth, it is important to broadly analyse how the outbreak will influence this sector and it’s still premature to assess the current impact. We are already seeing a slump in the hotel and hospitality sector due to the cancellation of flights and closure of borders. The retail sector too will be challenged due to sourcing disruptions in the apparel, footwear and accessories space. Moreover, the slowdown is already being reflected in the delayed decisions by retailers to lease spaces. While the commercial sector has been on a strong foothold, investors and businesses will adopt a wait-and-see approach that we’re witnessing in other global markets.”

 

— Samantak Das, Executive Director and Head of Research, REIS, JLL.

 

 

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