COVID 19 Impact

April 2020
COVID 19 Impact

With more than 42,000 lives lost and over 850,000 positive cases worldwide in around 200 countries, the coronavirus disease (COVID 19) is continuing its destructive act on the world. The world is on a war footing to prevent the spread of the deadly virus. The pandemic has done a bloodbath in the global economy, which was on a recovery path after the slowdown in 2019. Equipment India had also previously reported the grave impact the pandemic has had on the auto component industry as well and the relief measures ACMA is taking to protect its members and workforce.

                                   (Speaker:  Anant Raj Kanoria, CEO, iQuippo) 

The world is facing the worst crisis after World War II according to UN Secretary General. Globally, the pandemic has severely impacted Italy, the worst affected with death toll crossing 10,000 while some of the European countries of Spain, France, Germany and the UK are fighting hard to prevent the spread. While the US has the most cases of COVID 19, most Asian countries are also trying hard to prevent the virus attack. China, the epicentre of the COVID 19, is now recovering with no major cases reported.

In India, the situation is becoming alarming as the virus is fast spreading across the country. The number of people affected in the country is reaching 1,500 and may go up in the following days, while 35 people have lost their lives. Considering the densely populated Indian cities, compared to other countries worldwide, it is easy for the virus spread fast in the community. So far the most cases have been limited to the people having travel history to the affected countries. A community spread will make matters worse. Prime Minister declared a complete lockdown in the country to prevent further spread of the virus.

Impact on CE market
The spread of COVID 19 in India has forced the government for a complete lockdown in the country. This has affected the construction activities in the country, as the take off of the announced projects and the announcement of new projects will be delayed. All these will have a cascading effect on the construction equipment market. Also, some industrial regions in the country have shut down production temporarily. All these are going to impact the construction equipment industry, at least for now. While the real estate projects have almost stopped, infrastructure projects are on a slower pace. According to certain contractors, many ongoing projects have slowed down due to restrictions from the authorities, lack of availability of materials and people due to safety reasons. If the situation is going to deteriorate further, then there can be a complete shutdown of construction projects, according to the contractors. This will impact the construction equipment market as the industry is staring at a further decline in sales in 2019-20.

What lies ahead?
Currently, the most important thing is to contain the spread of the virus. Minimising people movement is the only way to prevent community spread and the country is making this possible with a complete lockdown. This will impact the production, movements and installations of construction equipment during the period. It will also impact people involved in all these operational segments. Government has announced a Rs 1.7 trillion package to ease out the coronavirus impact on the people of the country. The industry will also need support from the government. Once back from today’s uncertain situation, the construction equipment industry will require support from the government through some relaxation on various fronts. A turnaround is imminent as a lot has planned on infrastructure development which is bound to happen in the coming years.

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