It is no secret at this point in time that the Indian economy is suffering a major downfall. In various sectors across the spectrum, there have been numerous job losses, downward spiral of sales and businesses shutting down altogether.
Earlier this year, the current government had devised a plan for the country to emerge as a $5 trillion economy by 2024-25, and results from economic surveys for the fiscal year 2018-19 have shown that to attain that goal, India needs to sustain a real GDP growth rate of eight percent.
However, in its recent World Economic Outlook, the International Monetary Fund (IMF) cut India’s growth this year from 7 percent in July to 6.1 percent, stating that the country reflected a “weaker-than-expected outlook for domestic demand” and that it has to address its “cyclical weaknesses and strengthen confidence.”
Thus, Guwahati is no exception to this phenomenon and with the festive season upon us, market trends have not shown any improvement even with multiple offers and discounts available to customers.
“The market has been significantly down as compared to last year. There has been minimal to zero growth and the footfall of customers has also lessened. The market is basically thanda. I’ve been sitting at my shop since morning and it seems like customers have no money to spend this time around,” said a retail store owner from Guwahati’s business hub in Fancy Bazar, speaking to G Plus.
While another store owner from the area stated that he does not even have much expectations for the upcoming Dhanteras and Diwali festival as sales were down during the past few weeks in Durga Puja as well.
“We basically have no expectations from 2019. Let’s see what 2020 has in store for us,” added the store owner, tense but ever so slightly hopeful.
Private sector in the slump
Many businesses in the private sector are facing a time of crisis. While earlier the festive season heralded sales and heavy footfall, this season has seen empty showrooms and the wailing faces of business owners across the city.
Speaking to G Plus, a prominent businessman of the city said, “The automobile sector is in crisis. There has been no uptake in sales in the northeast region even though numerous offers and puja discounts have been made available to the public. The incentives don’t seem to be working this time around. Business is simply not good and the slowdown is clearly visible in our numbers.”
Another dealer stated, “If you look at the numbers, Guwahati is 25 percent down and I don’t see much improvement in the automobile sector because the government does not want to seem to help this industry. However, the automobile sector as a business will always be there, it might be slow, might catch up, but it will not diminish.”
Even while speaking to small businesses in the city, G Plus found that the footfall in these sectors has also diminished in the past few months.
A clerk from a popular retail store in GS Road mentioned that people hardly came in to purchase anything and several of these stores are now found empty.
“If customers did show up, they only bought need-specific items and rarely overspent,” she added.
Modi to the rescue? 5% hike in DA announced for central govt employees
Keeping in mind the recent market trends, the Centre, on October 9, increased the dearness allowance (DA) by five percentage points for all central government employees in a bid to boost the economy and increase spending power.
While announcing the same, Union Minister Prakash Javadekar termed this hike, which will be effective from July 2019, as a “Diwali gift” wherein central government employees and pensioners will be paid 17 percent of their basic salary as DA.
DA is a part of salary paid to employees working for the government to compensate them for inflation. It is revised twice annually in January and July for central government employees.
Based on Javadekar’s announcement, this increase will cost the Centre Rs. 16,000 crore every year and will impact 50 lakh serving personnel and 65 lakh pensioners.
The union minister also noted that this is the highest ever 5 percentage points increase in DA at one go made by the Centre.
It should be noted that this is the second time the government has increased the DA for central government employees after an increase of 3 percent hike in DA from 9 percent to 12 percent in January earlier this year.
Speaking to G Plus, Padmapani Bora, an IRS officer said, “Market prices for some items are increasing, so the increase in DA is definitely going to help us as 5 percent is a lot. Also, the basic cost increased with the 7th Pay Commission, even the 6th Pay Commission. Therefore, since our basic is higher, we will get a handsome amount after the hike and it will help to meet our various expenses.”
Bora also mentioned that he thinks this hike will help in increasing purchasing power and that since supply already exists in the market, we might see a slight increase in demand as well.
