Impact on aviation:
As you tourism and traveling was restricted during lockdown in mostly all of COVID-19 impacted countries, obviously there will great loss for them for that period and aviation industry have gone downward. However now government of many countries have started operating in restricted manner, we hope that aviation sector can recover their essential expenses and we see the sector not going downward now. I think it will recover by making ” U shape ” post Corona virus vaccine.
Hospitality industry have gone downward too but their Expenses are not like aviation industry, so the decreasing trend line in not so steeper. Also during restricted opening, hospitality industry are mostly closed, we will see continued decreasing trend. However, this industry cannot be predicted much because it will depend on people mindset. If people are afraid to travel and enjoy vacation even after government of all countries opens everything after COVID-19 graph gets flattened, the decreasing trend may stop but recovery will be not so soon.
We have to also note that manufacturing depends upon sales. So if there is no sales, manufacturers won’t produce to keep so much stock.
Essential goods sector like FMCG, pharma and related are least impact during COVID-19 and neither it is expected to decrease so much. Manufacturing related to other sector are suffering a lot and will continue even after opening lockdown.
It will show sign of recovery only after vaccine.
Moratorium:
The EMI moratorium is not FREE. It has costs attached to it. Since the RBI has allowed lenders to charge interest during the moratorium period, there will be an interest-on-interest effect. The end result is after the 3-month moratorium period, either your EMI will go up or your existing loan tenure will get longer. This is the bad part.
Credit cards are also included as part of the moratorium.
All these will offcourse impact the business of banks and I am tensed that it will increase their NPA after moratorium. This is because their is anyway increase in unemployment and losses to many businessess. If they didn’t earn enough money it will impact their EMI paying capability.
All these are linked government should do some effective planning and implementation for recovery overall economy, so that everything turns good slowly.
