The novel coronavirus has dramatically changed Indian business models. Companies were forced to respond quickly to unprecedented challenges that obliged them to change rapidly, mostly in an oscillating manner between struggle and innovation across all sectors.

More than 82% of small Indian firms suffered from adverse pandemic effects; manufacturers were even more disturbed. 70% of firms feel it would take them at least a year for recovery to revert and demand come back like earlier. The trade impact for India is likely to be $348 million for exports and about $150 million for imports. For the survival of businesses, there is a reassessment of models; digitization, innovative offerings, and changes in strategies according to shifting market requirements.

This blog explores the deep influence of pandemic starting with COVID-19 deaths, there have been lockdowns because of global health crisis and even COVID-19 cases in India. Then the blog discusses how businesses innovate in the face of these challenges.

Understanding COVID-19 Impact on Indian Business

India has experienced staggeringly high COVID-19 statistics throughout the pandemic. Until now, it has recorded over 44 million cases of corona and nearly 530,000 deaths in its country. The sudden jump in how the disease spread saw massive nationwide lockdowns across the country; this resulted in greatly disrupting the economic activities in every sector.

Do You Know? The pandemic has encouraged the positive acceleration of digital transformation in India, with several businesses accelerating their turn towards digitization by using online tools and e-commerce platforms to reach customers.

The Early Impact: Lockdowns and Economic Disruption

March 2020 added only a great shock to the Indian economy, witnessing the first lockdown. According to Dun & Bradstreet, more than 82% of small firms reported that they had been affected in one way or the other due to coronavirus. Manufacturing has been the most affected area as nearly 87% of those firms have been severely impacted.

COVID-19 Death Toll Statistics

1. COVID-19 Deaths: India saw over 500,000 deaths till the middle of 2021.
2. COVID-19 Cases in India: The country saw millions of verified cases. The summits came during the second wave in April and May 2021.
3. Economic Contraction: India’s Gross Domestic Product declined by 7.3% in FY 2020-21, at which time it experienced its worst performance since gaining independence.

These numbers describe how things were pretty bad and had further implications in various sectors.

Impact of COVID-19 Slowing Economic Growth and Declining Cash Flows

Asian Development Bank (ADB) has said in its FY 2020-21 Outlook on 5th April 2020 that Indian economic growth is likely to slow down to 4% this fiscal on the back of the current global health emergency.

Growth in India will remain subdued after the country suffered a sharp slowdown last year from 6.1% in fiscal 2019 to fiscal 5% as a credit crunch that originated in the NBFC sector severely hampered banks’ lending.

Impact on Operations and Cash Flows

In the wake of the pandemic outbreak over 50% of Indian companies see the impact on their operations and nearly 80% have witnessed a decline in cash flows as per FICCI Survey.

Sectors such as tourism, hospitality, aviation, retail, and entertainment were hit directly, and operational challenges were put forth before the manufacturing and service firms. It also fast-tracked digital adoption and innovation in the Indian business landscape.

How COVID-19 Lockdowns Reshaped Indian Travel and Hospitality

The tourism and hospitality sectors have fared the worst, perhaps. With international borders shut and domestic travel drastically reduced, the number of visitors to shopping complexes and cinema theatres has drastically decreased. This has hence affected the retail sector, leading to the reduced consumption of both essentials and non-essentials.

DO YOU KNOW? Regarding the history of COVID-19 vaccination in India is that as many as 4.2 million COVID-19 deaths were averted there in 2021, according to a 2022 modeling study published in The Lancet Infectious Diseases journal.

Future of Healthcare and Medical Supplies: Lessons Learned from SARS-CoV-2

It has also brought to light the very fact that the country needed a strong healthcare infrastructure. The second-born wave of the pandemic had already plunged the country into serious trouble with many shortages of vaccines, hospital bed tents, oxygen cylinders, and other medical supplies. On the other hand, this gives great importance to stepping up public health surveillance and controlling the spread of this infection.

In this regard, very quick innovation was experienced in the healthcare sector as companies opted to manufacture essential medical supplies such as PPE kits and sanitizers. This did not only fill some urgent needs but also opened new revenue streams for businesses as well.

Supply Chain Disruptions and Lockdown Challenges

(Source: dun & Bradstreet)

Reduced cash flow is having an impact on all the payments including those for employees, interest, loan repayments, and taxes. The survey says that more than 60% of the respondents have felt an influence in their supply chain and expect it to deteriorate further.

What Are the Financial Challenges for Indian Business Tycoons During the Pandemic?

(Source: dnb& bradsheet)

The businesses in India faced various issues during the COVID-19 crisis.

1. Access to Market: Access to the market has emerged as one of the major hurdles to growth so far reported by 42% of the responding businesses.
2. Productivity Improvement: As many as 37 percent of respondents said that they were finding it difficult to improve productivity amid the pandemic.
3. Availability of Finance: Almost 34 percent of the respondents reported that they were facing difficulties in accessing credit and finance.
4. Compliance Issues: Compliance-related problems plagued 31% of the manufacturing firms.
5. Unfavorable Domestic Market Conditions: 30% of service firms were influenced by unfavorable market conditions within India.
6. Aviation and tourism: were perhaps the worst affected, along with an estimated 38 million job losses, which is around 70% of the total workforce. Demand for transport fuels by the oil and gas industry came down drastically when both manufacturing, along mobility, came to almost a standstill during the lockdowns.

Despite all these challenges, some organisations adapted and found innovative ways of carrying out their business. First, companies started to look at new Indian business ideas and shifted their offerings to meet the mutated consumer demands.

(Source: aima)

DO YOU KNOW? The estimated trade impact of the coronavirus epidemic is around $348 million for India.

Indian Business Tycoons Response

Indian business leadership luminaries have also come forward to emphasize the need for strategic investment in technology and infrastructure to tackle the challenges of the post-pandemic world. A collective push from their insights creates a call for resilience and innovation within the business community.

Workplace Safety Guidelines Post-COVID-19: Ensuring Employee Well-being

At least 40% of the Indian companies have put in place stringent checks on people entering their offices and disinfection while nearly 30% have already put in place work-from-home policies for their employees. The National Lockdown is in place since 25th March and is expected to remain till 14th April 2020.

DO YOU KNOW? As a part of the “Aatmanirbhar Bharat” (Self-Reliant India) initiative, the Indian government has been urging the industry to promote local supply chain networks.

COVID-19 Deaths and Economic Impact: The Need for Government Action

The economic package announced by the Central Government may accord a momentary glimmer of light at the end of the tunnel. But industry leaders know that once the storm is over, it will be a hard road to recovery, and it will take far more than building greater competencies in the domain of technical skills to get the job done.

The Indian government undertook various measures to assist organisations in distress. It assisted the MSMEs with several cash flow relief schemes designed to stabilize the operations. For most such businesses, access to an Indian business loan became critical in the quest to recover from the financial strain resulting from the pandemic.

Furthermore, the pandemic has highlighted financial resilience. Many companies are now looking for Indian business loans in a bid to strengthen their liquidity and stay afloat during the financially tough period.

(Source: aima)

A FICCI survey reveals that 53% of the Indian businesses have felt a significant impact right from the early stages of the pandemic and 73% have witnessed huge downturns in both their orders and inventories. Other areas have been cash flow, supply chains, and employee policies, which were impacted and most people hope for improvements over the next six months.

Innovative Indian Business Ideas Emerging from Social Distancing Practices

Many e-commerce platforms allow businesses to maintain sales directly, with social distancing measures in place. Growth opportunities increased further and motivated various firms to start searching for innovative Indian business ideas related to technology, such as online services, remote work solutions, and other such technological ideas.

The need for social distancing has brought down all manufacturing and service industries. Both demand and supply have been affected. It has also increased fear of loss of jobs and income. Working from home has provided a certain degree of business continuity for some companies where WFH is possible. The lockdown has disrupted supply lines in the country at interstate checkpoints where road transport is held up.

(Source: designnbuy)

DO YOU KNOW? The pandemic made retailers turn to online operations, with Flipkart and Amazon joining local kirana stores retrofitting to deliver goods safely. India’s e-commerce market will grow to $111 billion by 2024.

Looking Ahead: The Future of Indian Business Post COVID-19

21-day lockdown is a first step that buys India time to improve its preparedness. Countries will have to significantly increase the number of novel coronavirus tests to reduce the fog of uncertainty as regards where hotspots are.

India would now plan for what happens after the lockdown if the virus is not defeated. It will have to restart certain activities in certain low-infection regions with adequate precautions.

India will have to ensure that in the meantime poor and non-salaried lower middle class who are prevented from working for longer periods can survive. Direct transfer to households may reach most, but not all, and the quantum of transfer seems inadequate to see a household through a month.

How COVID-19 Guidelines Affect Support for Poor Communities in India

India will have to ensure that the poor and no salaried lower middle class, who are forbidden from working longer, can survive.

Direct transfers to households could reach most, but not all, and the quantum of the transfer does seem quite inadequate to see a household through a month.

The Road to Recovery: Navigating the Impact of COVID-19 on Indian Business

(Source: economic times)

Almost all sections of India’s business have been disrupted by coronavirus. If the lockdown is extended after 14 April and partial restart of economic activity is permitted in less affected areas, it will send a positive signal for both demand and supply.

If India can contain the impact of pandemic it may be possible to restart economic recovery from June-July 2020. Hopefully, Indian businesses can look at recovery with effect from October 2020 and business as usual by 4th quarter of this fiscal.

The COVID-19 pandemic had severally impacted Indian industries to a great extent, resulting in a contraction of the GDP and decline of corporate revenues. The aviation business suffered from an enormous decline of 90.8%. The pandemic accelerated digital transformation, innovation, and adaptations for business in the post-COVID-19 scenario.

How AITD May Assist Companies Rethink Business Models

In an effort to scale up its solutions to help companies face the challenges brought by the COVID-19 pandemic, the Amity Institute of Training and Development offers integrated solutions. AITD is in a position to offer multidisciplinary expertise in many fields among them

1. Conflict Management

AITD equips an organisation to spot and resolve any potential conflicts that might come to the fore while doing business, such as supplier, employee, or customer quarrels. Due to the provision of mediation and negotiation service support, AITD assists organisations in finding mutually beneficial solutions.

2. Change Management

The institute assists them in managing organisational changes needed for the post-COVID-19 landscape. AITD enables organisations to develop and execute strategies for communication, employee engagement, and cultural change.

3. Digital Transformation 

AITD aids businesses in speeding up their digital initiatives by providing training and consulting solutions that are apparently helping the organisations use the technology for efficiencies, customer experience, and cost savings.

Commitment of AITD to Business Recovery

AITD helps businesses bounce back from the shock of the pandemic because it provides personalized training to the type of needs faced by organisations today, and from which companies can more easily regain strength, and foster innovation in operations.

Pandemic As a Change Enabler for Indian Businesses Despite the tremendous challenges created by the COVID-19 pandemic, this situation has triggered change in Indian businesses. This situation has tried to open many doors for innovation and transformation with the internet and related digital tools and adaptational strategies and, most importantly, seeking support from organisations such as AITD.