From small businesses to farmers, middle India is driving demand

News Network
November 29, 2020

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New Delhi/Mumbai, Nov 29: Manish Mehra, owner of Washex Hospitality, an industrial laundry service, recently flew from Delhi to Jodhpur, a city in north-western India, to win a contract to service a large, government-run hospital - a move essential to kickstarting his business.

"For a new relationship it is essential to know each other before you can establish the trust and confidence to work online and that need is higher in case of government departments," said Mehra, who had to stay for a week in a Jodhpur hotel.

Increased demand for air travel and hotel stays by small business owners like Mehra, accompanied by a rise in rural incomes and spending after two good monsoons, is helping the pandemic-hit Indian economy slowly recover.

Government data released on Friday showed the economy shrank 7.5% in the July-September quarter, performing better than analysts' expectation of an 8.8% contraction as lockdowns were eased and some pent-up demand was met. In the April-June period, the economy shrank 23.9%.

Annual growth of 3.4% in farm sector and 0.6% in manufacturing during the September quarter has raised hopes of an early recovery and some service sectors such as trade, hotels and transport contracted at a much slower pace compared with the April-June period.

Farmers, benefiting from a bumper crop, are lapping up tractors while demand for personal vehicles, due to a lack of public transport and the need for safer travel options, has boosted sales of cars and motorcycles.

There has also been an uptick in goods and services, tax collections and higher energy consumption.

A recovery is taking shape and it has been led by the manufacturing sector which has moved from near annihilation in the July quarter to rebound mode, said Yuvika Singhal, an economist at QuantEco Research.

"Until there is a stronger recovery in high contact service sectors, which make up 60% of the GDP, agriculture and manufacturing are expected to carry the growth," said Singhal, adding that India is still growing on a lower GDP base and it will take more than a year to recover lost output.

Slow start for hotels and airlines

A string of Marriot hotels in industrial towns like Sriperumbudur, Visakhapatnam and Nasik are operating at 50% to 60% occupancy with the bulk of guests working with domestic manufacturing companies, said Ashish Jakhanwala, CEO of hospitality firm SAMHI which owns the properties.

Meanwhile SAMHI's hotel in the tech-city of Bengaluru, that mainly depends on large corporates, is filling only 20% to 30% of rooms.

"Demand from large corporates and international travel will take longer to recover. Hotels catering to public sector and infrastructure companies are doing better," said Jakhanwala.

Since the end of May, when the government lifted a ban on flights, monthly domestic passenger traffic has more than doubled from 2 million in June to over 5 million in October. But that is still down from about 12 million a year ago.

India's biggest carrier IndiGo and rival Vistara are seeing an uptick in business travel but to a much smaller extent than before.

"Much of it is from small and medium enterprises (SMEs) or small business owners who cannot afford to sit at home," said Vinod Kannan, chief commercial officer at Vistara, a joint venture between Singapore Airlines and Tata Group.

SMEs have contributed to a 35% to 40% recovery in hotel bookings compared with pre-Covid times and between 27% and 32% recovery in flights, according to online travel agency MakeMyTrip.

Rural revival robust

In the hinterlands, the impact of Covid-19 has not been as severe as in the big cities and farmers have benefited from good rainfall for two consecutive years leading to a bumper harvest and adequate conditions for winter-sown crops. This is driving up sales for tractor makers like Mahindra & Mahindra.

Lack of adequate and safe public transport in small towns and villages has also pushed up demand for cars and motorcycles.

Maruti Suzuki, India's biggest carmaker, had a 10% growth in rural sales between July and September versus a 4% rise overall, led by small, entry-level models, said Shashank Srivastava, executive director, marketing and sales.

"While Bharat (rural India) is leading India in terms of a recovery, it cannot carry India," he said, adding that steady, long-term demand will depend on improving economic factors, growing incomes and a rebound in urban markets.

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News Network
November 18,2024

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Mangaluru: The Ullal police have arrested Manohar, the owner of Vazco Beach Resort, and its manager Bharath in connection with the drowning of three college girls from Mysuru at the resort’s swimming pool on November 17.

City Commissioner of Police Anupam Agrawal confirmed the arrests, stating that a case has been registered under Section 106 of BNS. The bodies of the victims, all in their twenties, have been handed over to their parents. The women had arrived at the resort for a weekend getaway on November 16.

Following the tragic incident, the resort was sealed by officials led by Mangaluru Assistant Commissioner Harshavardhan. The trade license of the resort, issued on June 13, 2024, has been suspended, and the tourism department has temporarily revoked the resort's registration. These actions prohibit the resort from engaging in any tourism-related activities until further notice.

Someshwara TMC Chief Officer stated that the suspension was due to the resort's failure to implement adequate safety measures, which resulted in the loss of three lives. Further investigations are underway.

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News Network
November 21,2024

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After the US prosecutors charged Gautam Adani with bribery and fraud, Congress reiterated its call for a Joint Parliamentary Committee (JPC) probe into the transactions of the Adani group, and hit out at Prime Minister Narendra Modi, alleging an "internal nexus" between him and "his favourite businessman."

Senior Congress leader Jairam Ramesh said the indictment of Gautam Adani and others by the US Securities and Exchange Commission validates his party’s call for a Joint Parliamentary Committee investigation.

The Congress has been pushing for the probe since January 2023, raising concerns over alleged irregularities involving Adani and his business dealings, said Ramesh.

Ramesh referred to the party’s “Hum Adani ke Hain” series, where 100 questions were raised about the alleged scams and the links between Prime Minister Narendra Modi and Gautam Adani.
He noted that the questions remain unanswered, reiterating the need for accountability in the matter.

The US prosecutors have charged Adani with deceiving investors by concealing information about his firm's solar energy project in India, which allegedly involved bribery.

Adani has been charged with securities fraud and conspiracy, according to an indictment unsealed on Wednesday. The case focusses on an agreement between Adani Green Energy Ltd. and another organisation to supply 12 gigawatts of solar power to the Indian government.

'BETRAYAL OF INDIAN INVESTORS'

Congress leader Pawan Khera described the allegations against Gautam Adani and his conglomerate as a “betrayal of Indian investors.”

Taking to X, Khera outlined the US charges, including claims that Adani’s group bribed Indian government officials between 2020 and 2024 to secure contracts. Citing media reports, he also pointed out that Gautam Adani personally met a government official to advance the scheme.

Khera referred to a March 2024 incident where the Adani Group allegedly misled the Bombay Stock Exchange and the National Stock Exchange, calling it a “grave violation of investor trust.”

He further highlighted a March 2023 FBI raid on the premises of Sagar Adani, Gautam Adani’s nephew, where electronic devices were seized as part of the investigation.

'SEBI NOT ABLE TO PROVE ANY CHARGES AGAINST ADANI'

Shiv Sena (UBT) leader Priyanka Chaturvedi criticised central probe agencies following US charges against Gautam Adani and others in an alleged bribery case linked to solar energy contracts.

Chaturvedi raised concerns about corporate governance and regulatory oversight in the country. “They talk about corporate governance, responsibility, and accountability. The industrialists should be asked to follow the rules and regulations, but even the agencies were defending him. The SEBI has not yet been able to prove charges against him,” she said, pointing to what she viewed as failures in ensuring accountability.

'BROUGHT DISREPUTE TO INDIA'

On US charges against Gautam Adani, AAP leader Sanjay Singh called for a probe against the industrialist. He said that the probe should be conducted by an investigation agency under the Supreme Court.

"Adani Group has brought disrepute to India. This is a very serious matter. The PM of India should come forward and answer this. All the pending matters against Adani should be probed by an investigation agency under Supreme Court monitoring, and all the corruption done by him, within and outside the country, should come out before the country and action should be taken against him," he said.

BJP DFENDS

BJP IT cell chief Amit Malviya responded sharply to the Opposition’s criticism regarding allegations involving Adani Green Energy and US-based Azure Power. He pointed out that the charges in the indictment are only allegations and emphasised, “The defendants are presumed innocent unless and until proven guilty.”

Malviya argued that the crux of the case concerns agreements to supply 12 GW of power to the Solar Energy Corporation of India (SECI), contingent on SECI securing power purchase agreements with state electricity distribution companies (SDCs).

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News Network
November 15,2024

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Iran’s Islamic Revolution Guards Corps (IRGC) has killed or captured 69 terrorists linked to the Israeli spy agency Mossad during a major counterterrorism drill in the country's southeast, its spokesman says.  

General Ahmad Shafaei, the spokesman for the “Martyrs of Security” drill, said Friday that a total of 23 terrorists have been killed and another 46 arrested in various clean-up operations ever since the IRGC Ground Force launched it in the Sistan and Baluchestan province on November 1.

Seven terrorists have also turned themselves in during the period.

“The undeniable fact about terrorists is that they rely on arrogant powers, particularly the intelligence service of the wicked and vicious Zionist regime," Shafaei said.

“Unfortunately, weapons and munitions at terrorists’ disposal are among the most sophisticated ones in the world. This accounts for their heavy dependence.” 

The official stated that several members of the disbanded terror teams were non-Iranian nationals, who had been hired by foreign intelligence agencies to carry out acts of sabotage and terror inside Iran.

In a most recent operation, six terrorists were arrested and four others were eliminated, three of whom were non-Iranians, he added. 

On October 26, ten members of Iran's law enforcement forces were killed in a terrorist attack in the Gohar Kuh district of Taftan in the Sistan and Baluchestan province.

The so-called Jaish al-Adl terrorist group claimed responsibility for the assault, which was one of the deadliest in the province in recent months.

The group has carried out numerous terrorist attacks in Iran, primarily in Sistan and Baluchestan.

Its tactics include the abduction of border guards as well as targeting civilians and police stations within the province to incite chaos and disorder.

In January, Iran launched a military operation during which the headquarters of the Pakistan-based terrorist group was targeted in missile strikes, destroying its infrastructure.

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