Skip to main content

Costs built up, sales, profits 'much less than normal' ahead of COVID-19 crisis: Survey

Current costs per unit (% responses)
By Our Representative
The Business Inflation Expectations Survey (BIES) by the Indian Institute of Management-Ahmedabad (IIM-A) for the month of February, just ahead of the outbreak of the coronavirus crisis in India, has suggested that the Indian economy had already begun to feel a crisis situation in February, with signs of costs building up, and sales and profits reaching much less than normal.
The survey, which involved responses of over 1,200 companies, suggested that the cost perceptions data show early signs of pressures building up. Nearly 50% of the firms believed that the current cost increase was 3.1% and above as compared to the same time last year, and over 30% of the firms perceived that the current cost increase was over 6%, the highest since 2017.
Further, it found, over 15% firms perceive that current cost increase was over 10%.
Sales levels (% responses)
The survey also showed that, in February 2020, over 64% of the firms reported that sales were much less than normal as against 45% reported in January 2020. Around 85% of the firms in the sample reported that sales were ‘somewhat or much less than normal’ as against 70% reporting in January 2020.
Coming to profits, the survey said that the proportion of firms in the sample reporting ‘much less than normal’ profit jumped up by over 20% to 65% in February 2020. Over 87% of the firms in the sample expected ‘much less than normal or somewhat less than normal’ profit margins. The proportion remained around 75% since June 2019, it added.
Profit margins (% responses)
Claimed the survey, BIES provides ways to examine the amount of slack in the economy by polling a panel of business leaders about their inflation expectations in the short and medium term. A monthly survey, it asks questions about year-ahead cost expectations and the factors influencing price changes, such as profit, sales levels, etc.
The survey goes straight to businesses, the price setters, rather than to consumers or households, to understand their expectations of the price level changes in order to get a probabilistic assessment of inflation expectations, thus getting a measure of uncertainty. At the same time, it provides an indirect assessment of overall demand condition of the economy. Companies are selected primarily from the manufacturing sector.

Comments

TRENDING

'Draconian' Kerala health law follows WHO diktat: Govt readies to take harsh measures

By Dr Maya Valecha*  The Governor of Kerala has signed the Kerala Public Health Bill, which essentially reverses the people’s campaign in healthcare services in Kerala for decentralisation. The campaign had led to relinquishing of state powers in 1996, resulting in improvement of health parameters in Kerala. Instead, now, enforcement of law through the exercise of power, fines, etc., and the implementation of protocol during the pandemic, are considered of prime importance.

A Hindu alternative to Valentine's Day? 'Shiv-Parvati was first love marriage in Universe'

By Rajiv Shah*   The other day, I was searching on Google a quote on Maha Shivratri which I wanted to send to someone, a confirmed Shiv Bhakt, quite close to me -- with an underlying message to act positively instead of being negative. On top of the search, I chanced upon an article in, imagine!, a Nashik Corporation site which offered me something very unusual. 

Bihar rural women entrepreneurs witness 50% surge in awareness about renewal energy

By Mignonne Dsouza*  An endline survey conducted under the Bolega Bihar initiative revealed a significant increase in awareness of renewable energy among women, rising from 25% to 76% in Nalanda and Gaya. Renu Kumari, a 34-year-old entrepreneur from Nalanda, Bihar, operates a village eatery that serves as the primary source of income for her family, including her husband and five children. However, a significant portion of her profits was being directed toward covering monthly electricity expenses that usually reach Rs 2,000. 

Work with Rajasthan's camel herders: German scientist wins World Cookbook Award 2023

By Rosamma Thomas*  Gourmand World Cookbook Awards are the only awards for international food culture. This year, German scientist  Ilse Kohler Rollefson , founder of Camel Charisma, the first of India’s camel dairies, in Pali district of Rajasthan, won the award for her work with camel herders in Rajasthan, and for preparing for the UN International Year of Camelids, 2024. 

Reject WHO's 'draconian' amendments on pandemic: Citizens to Union Health Minister

By Our Representative  Several concerned Indian citizens have written to the Union Health Minister to reject amendments to the International Health Regulations (IHR) of the World Health Organization (WHO) adopted during the 75th World Health Assembly (WHA75) in May 2022, apprehending this will make the signatories surrender their autonomy to the “unelected, unaccountable and the whimsical WHO in case of any future ‘pandemics’.”

Swami Vivekananda's views on caste and sexuality were 'painfully' regressive

By Bhaskar Sur* Swami Vivekananda now belongs more to the modern Hindu mythology than reality. It makes a daunting job to discover the real human being who knew unemployment, humiliation of losing a teaching job for 'incompetence', longed in vain for the bliss of a happy conjugal life only to suffer the consequent frustration.

Golwalkar's views on tricolour, martyrs, minorities, caste as per RSS archives

By Shamsul Islam*  First time in the history of independent India, the in-charge minister of the Cultural Ministry in the current Modi government, Prahlad Singh Patel, has glorified MS Golwalkar, second supremo of the RSS and the most prominent ideologue of the RSS till date, on his birth anniversary, February 19. In a tweet he wrote : “Remembering a great thinker, scholar, and remarkable leader #MSGolwalkar on his birth anniversary. His thoughts will remain a source of inspiration & continue to guide generations.”

Why is electricity tariff going up in India? Who is the beneficiary? A random reflection

By Thomas Franco*  Union Ministry of Power has used its power under Section 11 of the Electricity Act, 2003 to force States to import coal which has led to an increase in the cost of electricity production and every consumer is paying a higher tariff. In India, almost everybody from farmers to MSMEs are consumers of electricity.

Deplorable, influential sections 'still believe' burning coal is essential indefinitely

By Shankar Sharma*  Some of the recent developments in the power sector, as some  recent news items show, should be of massive relevance/ interest to our policy makers in India. Assuming that our authorities are officially mandated/ committed to maintain a holistic approach to the overall welfare of all sections of our society, including the flora, fauna and general environment, these developments/ experiences from different parts of the globe should be clear pointers to the sustainable energy pathways for our people.

Environmental cost of Green Revolution: India world’s second-highest fertilizer importer

By Glenn Davis Stone*  Feeding a growing world population has been a serious concern for decades, but today there are new causes for alarm. Floods, heat waves and other weather extremes are making agriculture increasingly precarious, especially in the Global South .