Greetings of the day!
This edition will provide you with an in-depth analysis of the impact of Unlock 1.0 announced by MHA on 30 June 2020. It has almost been a week since the unlock was announced. So, let’s dive in and discover the impact of the Unlock 1.0 on employers, employees and the Indian economy at large.
The Burning Tale
The nationwide lockdown that Prime Minister Narendra Modi had first announced on March 24, 2020, has come to an end and India has moved towards Unlock India 1.0 to resume all economic activities in a phased manner. The move has been welcomed by many as the beginning of a “new normal” while sceptics don’t seem to agree.
Impact on the Employers
Within a week of Unlock 1.0 various industries such as auto, power, pharmaceutical etc. have witnessed a sharp surge in demand. However, the employers are facing challenges to keep up the production at par with the demand due to the paucity of workers. Due to the shortage of manpower, many factories are facing a choice to either shape up or ship out. In cities like Gurugram, company owners are sending air tickets and cars to bring back workers to the city. Infrastructure companies, the country’s biggest job creators, are also following the suit as they too are facing a huge shortage of workers and pressure to meet deadlines of real estate projects.
Impact on Employees
Though the unlock has sparked hope and revived the demand of labourers but there isn’t much hope yet for qualified professionals. There aren’t as many white-collar jobs available. As per the CMIE website, there is a small dip in the unemployment rate but it isn’t enough to generate jobs for the 27 million youth who lost jobs due to coronavirus. Moreover, there is still a sense of insecurity even among employed professionals.
Some are learning to bite the bullet and taking pay cuts to survive in the industry while others are forced to sit at home and contemplate their future. Getting a decent job still remains a distant dream for many.
Impact on the Economy
The growth of employment opportunities isn’t as quick as one would want it to be but we need to concentrate on the bigger picture and realise that these baby steps are inching towards the recovery of the economy, which will gradually lead to job creation. Unlock 1.0 is turning out to be big positive for the Indian economy. Though it is a little early to jump to conclusions, the economy seems to be gaining momentum. However, economists are apprehensive and do not consider this as recovery as they argue that this may just be a pent-up demand and may soon fall owing to income loss. Domestic equity market benchmarks BSE Sensex and Nifty 50 settled over 2.5 per cent higher on the first day of unlocking and have ended the week on a higher note.
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BONUS :- We have made a detailed analysis of the moratorium offered by banks.Click here – https://youtu.be/oXqNdokYIOw
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1. Income Tax department issues new ITR forms
Bringing in some key changes in the income tax return forms, the income tax department has now released ITR forms for the financial year 2019-20. In the new ITR forms, a new Schedule DI has been inserted. Through this column, the Income Tax department seeks the details of the investment, deposit and payments made during the extended period till June 2020. This will be considered for claiming deduction under Chapter VI-A or for rollover of investment in the Financial Year 2019-20.
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2. No new govt scheme for a year
FM Nirmala Sitharaman has announced that no proposal of new scheme or sub-scheme which comes under, standing finance commission & expenditure finance commission will be stalled in 2020-21, except the proposals under PM Gareeb Kaliyan package, Aatma Nirbhar Bharat Abhiyan and any other special packages related to the Coronavirus. All ministries have been told to stop sending requests for new schemes to the finance ministry. Schemes already approved under the Budget will also stay suspended till March 31.Read More>Read More>
3. SC slams RBI on interest on loans in the moratorium
RBI sent an affidavit to the Supreme Court, saying that banking institutions and lenders will lose close to Rs 2 lakh crore, if interest is waived during the loan moratorium, which has now been extended up to August 31. On the issue of the interest rate waiver, the Supreme Court has told the Reserve Bank of India (RBI) that health is of greater importance as compared to the economy.Read More>Read More>
4. Trade unions call for a nationwide protest on July 3
Ten central trade unions, including Congress-backed INTUC, Left’s CITU and AITUC and others like AIUTUC, TUCC, HMS, SEWA, LPF, AICCTU and UTUC, on June 5 called for a nationwide protest on July 3 against alleged anti-worker and anti-people policies of the government. These unions had last held such a protest on May 22. The unions also asked the government to immediately hold the long overdue Indian Labour Conference to dwell upon the 12-point charter of demands, the labour and trade union rights, issues of job losses, wages, job security and the migrant workers’ issues.Read More>Read More>
5. SC reserves verdict on wages during lockdown
The Supreme Court restrained the central government from taking coercive action against employers who have not complied MHA’s order of salary during the lockdown. Justifying its direction on wages in the apex court, Centre said that employers claiming incapacity in paying salaries must be directed to furnish their audited balance sheets and accounts in the court. The top court reserved its verdict for 12 June stating that the government must strike a balance between workers and employers because the Covid-19 lockdown has impacted both.Read More>Read More>
Thank you for pausing from your busy day and gracing us with your precious time. We will get back to you in the next edition with more exciting and interesting updates.
Stay Safe, Stay Home.