Economic disaster just round the corner: CMAI

There are only two ways to ward off the coronavirus scare—minimise social contact and improve personal hygiene. "All CMAI members have been requested to follow simple rules for both these, and hopefully, this will have a salutary effect," CMAI chief mentor Rahul Mehta told Fibre2Fashion.

Speaking about the issues faced by members at present, Mehta said, "As of now, the closure of shopping spaces such as malls and high street stores, along with the general advisory to avoid public spaces has crippled demand, which is the biggest problem."

However, many other issues are likely to crop up if the current crisis continues. "Mainly, there will be the problem of working capital shortage. Members will not have the money flow required for payment of taxes, discharge of bank interest, repayment of loans, statutory dues, etc. Unless the government steps in with some major decisions, industry is going to go in a total tailspin. An economic disaster as bad or worse than the health crisis is just round the corner," Mehta added.

Though it is difficult to quantify projected losses at this juncture, Mehta said, "it would be safe to assume that most companies would be facing a drop of 30 per cent or so in their sales as well as profitability, and the industry could be looking at a 10 per cent to 15 per cent job losses."

Fibre2Fashion News Desk (RKS)