Consumer demand to get better with the arrival of COVID vaccine, says FICCI president

2020 has been an extremely challenging year for businesses across the globe, and especially so for India Inc, which has faced one of the strictest lockdowns across the world. As we transition into 2021, the industry’s business outlook is improving however, the mood is still cautious, with hopes largely pinned on a quick rollout of the COVID-19 vaccine.

In a survey conducted by Federation of Indian Chambers of Commerce & Industry (FICCI), in association with Dhruva Advisors earlier this month, 55 percent of the respondents said that they expect the economy to take a year to normalise — that’s only a marginal improvement from the 62 percent figure from the survey’s August edition.

59 percent of the respondents say weak demand is one of the key challenges they are facing now, managing costs and financial liquidity are the other major issues faced by those surveys.

However, 74 percent of the respondents expect the COVID-19 vaccine to have a significant impact on their businesses. In fact, 35 percent of businesses expect their growth to return to the pre-COVID level within six months after the vaccine rollout.

Uday Shankar, President of FICCI said, “The mood is cautiously optimistic, there is no case for being exuberant and very excited about it because let us not forget that COVID-19 is very much amongst us. We are very close to getting a vaccine in this country, but until a vaccine is delivered at scale we still have a challenge a real public health challenge, but also a challenge of mood, sentiment and confidence and that is what this survey adequately captures.”

On consumer demand, Shankar said, “There is demand and this demand is only going to get better as soon as there is a vaccine that has been administered to the population, I think you will somewhat of an accelerated demand.”

Dinesh Kanabar, CEO of Dhruva Advisors said, “74 percent of the survey are positive about the vaccine and obviously vaccine can be effective only if it is administered to scale. Another point which is standing out in the whole survey is that 69 percent of the people seem to be very gung-ho about manufacturing moving from China to India. That again is a very high number.”

He said, “On point whether India Inc will make vaccine mandatory, it remains to be – I think rather than making it mandatory employers like us are going to go back and say every employee will be provided vaccine free whatever be the cost. You make it incentive to the employees to take it, rather than make it mandatory.”-CNBC TV18