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CORONAVIRUS - The situation in India

​1. General Situation

Since beginning of March 2021 India is in a second corona wave. The delta variant of the virus seems to be more contagious and deadly. Today, in India more than 28 million confirmed COVID-19 cases have been recorded including 329.100 deaths.

The 4 states with the most number of confirmed cases are Maharashtra (5.362.370), Kerala (2.281.518), Karnataka (2.217.117) and Tamil Nadu (1.739.280). The most recent official number of cases in India can be found on the Government of India – Covid19 website which also gives the detailed state wise figures.

This second wave was much larger than the first wave with shortages of vaccines, hospital beds, oxygen cylinders and related medicines in many parts of the country. On 30th April 2021, India was the 1st country to report 400.000 cases in one day.

2. Preventive measures

The national directives for COVID -19 management shall continue to be followed strictly throughout the country till June 30th 2021. Depending on the situation, they may be further extended.
Compulsory mask, minimum 6 feet distance in public places, fine for spitting in public places and frequent sanitization are a must. Companies must ensure their employees continue to work from home as far as possible.

In the absence of a nationwide lockdown and with covid19 cases on a steady rise, a number of states in India had imposed since mid-April complete lockdowns to reduce the spread of the coronavirus amid a deadly second wave. Some states have chosen to do a partial lockdown. Those lockdowns are evaluated on a weekly basis and the measures are adapted accordingly to the cases. (List-of-states-under-lockdown-curfew-know-full-curfew-timings-dates)

India began the World’s Largest Vaccination Drive on January 16, 2021. The first group of vaccine recipients included the healthcare and frontline workers. The second group of vaccine recipients were people over 45 years of age and people under 45 years with comorbid conditions. The third group is from 18 till 45. On May 25th a total of 187.009.792 people have been vaccinated across the country. The vaccinations are being administered in two doses.

It is interesting to note that India makes 60% of the world’s vaccines and is home to a dozen major manufacturers. As there is a lack of vaccines, the production will have to increase, if there is enough raw material available. Russian Sputnik V is initially being imported for emergency use to boost the vaccination program and will soon also be manufactured in India.

Although India is still in the second wave, anticipating a third wave and more medical emergencies, India is trying to improve the healthcare systems.

3. Travelling

Since the 20th of October there are new covid rules at entry in India.

https://www.newdelhiairport.in/media/1836/guidelines-for-international-arrival-20th-october-2021.pdf

Travellers from specified Countries at risk [as mentioned in para (iii) above] will follow the protocol as detailed below:

a. If traveller is coming from a Country with which India has reciprocal arrangements for mutual acceptance of WHO approved COVID-19 vaccines (Category A):

  i. If fully vaccinated*: They shall be allowed to leave the airport and shall selfmonitor their health for 14 days’ post arrival.

 ii. If partially/not vaccinated: The travellers need to undertake the following measures: Submission of sample for post-arrival COVID-19 test at the point of arrival after which they will be allowed to leave the airport, Home quarantine for 7 days, Re-test on the 8th day of arrival in India and if negative, further selfmonitor of their health for next 7 days.

b. If traveller is coming from a Country excluding those covered under Category A, they would be required to undergo the measures as mentioned in para a (ii) above, irrespective of their COVID-19 vaccination status.

In practice it is not clear what is meant by “If traveller is coming from a country”. This could be the nationality or this could be the country of the departure of the flight to India.

Belgium, France and Germany are category A countries. So para a i or ii is applicable.

The Netherlands are NOT a category A country.

So for the time being, as the situation is not totally clear, it is advisable for travelers to India to book a flight coming from France or Germany and not to book a flight departing from Amsterdam.

The Ministry of civil aviation also announced that the air bubble will not be lifted soon.

The Indian Ministry of Health and Family Welfare publishes the latest travel advisories under travel advisories.

In the attachments you find the official documents with guidelines for arrival in India.

4. Economy

a. Economic impact 

The Indian economy contracted by a record 23.9 % in the April-June quarter of 2020 as the pandemic and lockdown affected the service sectors, manufacturing and construction. (It had grown 5.2 % in the same quarter a year ago). The cascading effect is still seen in the economy and the economy was slowly limping back before the 2nd wave hit again.

India's economy is projected to grow at 7.5 per cent in 2021 and around 10% in 2022, as per the United Nations Department of Economic & Social Affairs. (Source: Business Standard). Since April 2021 various States have implemented lockdowns, although less stricter than in 2020. The effect on the Indian economy is still to be seen.

The Highlights of the Economic Survey of India 2020-2021 can be viewed here.

b. Measures for Economic Relaunch

The Union Budget, presented on February 1, 2021 aimed consolidating of several COVID-19 response economic measures and to further energize the Indian economy through a combination of short-term, medium-term, and long-term measures.

The Budget Highlights and Budget at a Glance are enclosed.

The notable progressive policy changes are as follows:

  • New Companies set up in India which start manufacturing before March 31, 2023 - the applicable Corporate Tax is 15%
  • Production Linked Incentive Scheme – on approval basis for specified Industries for the next 5 years - incentive varies between 4-6% of the incremental sales
  • Faceless Tax Assessment – at various levels right up to tribunals making it transparent
  • New Labour Code:  Operational from April 1, 2021, the long pending labour issues have been addressed and all the following have been integrated into one comprehensive code and making it more progressive in approach

As a recollection, in November 2020, the Government of India announced US$ 36 billion stimulus package to generate job opportunities and provide liquidity support to various sectors such as tourism, aviation, construction and housing.

c. Trends

The pandemic has made businesses re-think their strategy and positioning. More and more companies are adopting lean strategy models. Decision making on expansion, internationalization, tie-ups and collaboration has slowed down considerably and stakeholders are being extremely cautious.

The focus on digitization is now of utmost importance for businesses across sectors irrespective of their size. Stakeholders and business owner now more so realize the value addition of incorporating digital platforms whether to support sales and marketing or to manage internal administrative affairs. Majority of Indian companies, especially the SME and MSME’s are now undergoing the digital transformation which was long overdue.

Due to the global cues of China Exodus, companies from across the globe are exploring India as one of the destinations for relocating their manufacturing base. Various Government initiatives are aimed to boost the country’s manufacturing sector and increase purchasing power of an average Indian consumer.

d. Opportunities

Following sectors have evolved and have witnessed significant demand as a result of the pandemic.   

Healthcare & Wellness: As people adopt better personal hygiene practices in the post-COVID-19 world, the consumption of immunity-boosting and wellness products is expected to see a rise. At present, products like disinfectants and sanitizers are recording the highest sales – a trend that seems likely to continue and become deeply ingrained in consumer behaviour. Fitness products like fitness tracking gadgets and apps are also seeing a surge in demand.  Moreover, as people turn to the online medium, provisions like online medicine delivery and teleconsulting will rise even further in the future. 

Digital & Internet Economy: In the Asia Pacific region, India is amongst the top three digital adapters for hardware, along with Japan and China, with the over 560 million and rapidly growing Internet users in the country (about 50% of our population). During the course of the pandemic, people started using digital medium for work, education, entertainment, shopping, and payments. Online platforms for work meetings has seen a massive rise in popularity. Meeting and Video calling Applications have come up with innovative features making it conducive for professionals to work from home. Some of the sectors that have witnessed exponential growth due to Covid are ed-tech, OTT platforms, fintech, remote working tools, e-commerce & delivery based services, and cybersecurity.

Automation: While automation technologies have been around for some time, deployed at various levels like chatbots, automated tele-calling, voice assistants, or the industrialized robotics but In the COVID-19 environment, where contactless interaction has been the top priority, automation technologies have found a much faster adoption rate than ever.

Speciality Chemicals: Increased need for cleansing and sanitation has catapulted the demand for hand sanitizers, disinfectants, and surface cleaners. India’s largest fast-moving consumer goods (FMCG) companies have rolled out a range of home cleaning, disinfectants, and personal hygiene products as they anticipate a surge in demand for such items amid the COVID-19 crisis.  Also, the increased demand for the disinfectants, drugs, and medicines due to the pandemic, has given an opportunity to the organizations manufacturing chemicals required for manufacturing these. Hence organizations dealing in chemicals are expected to see a spike in demand owing to increased demand for disinfectants, drugs, and medicines by the customers.

5. Useful links

6. Dossier Coronavirus

Het coronavirus heeft een wereldwijde impact, niet alleen op de gezondheid maar ook op de economie. Ook uw export kan hiervan gevolgen of zelfs hinder ondervinden.

FIT monitort de risico's dagelijks en ons buitenlands netwerk informeert u over alle implicaties voor Vlaamse exporteurs op hun internationale activiteiten.

In het dossier Coronavirus vindt u een aantal nuttige tips, adviezen en inzichten in de economische impact van de verspreiding van het virus op internationaal ondernemen.

Met vragen over internationaal ondernemen in tijden van Corona, kan u terecht bij exportadvies-corona@fitagency.be.

26 oktober 2021

Bijkomende informatie

List of countries  (PDF – 419 kB)