The aviation, automobile, construction, MSME, and tourism and hospitality sectors are likely to be the hardest-hit by COVID-19 pandemic, according to an RBI survey.The apex bank carried out a systemic risk survey "to capture the perceptions of experts, including market participants, on the major risks faced by the financial system". The survey was published in its financial stability report released recently.The results (of the survey) pointed out these sectors that are adversely impacted by the coronavirus pandemic.
TourismAs per 90 per cent of the respondents, "prospects of recovery within the tourism sector in the next six months appear bleak".
Construction50 per cent of respondents in the construction and real estate sector feel the chances of revival appear gloomy in the future.Construction was already suffering before the government announced the lockdown. Over 24 per cent of loans to this sector were categorised as non-performing as of March 2020, second only to gems and jewellery where around 25 per cent of the loans had already gone awry.
AviationThe aviation sector appears to be a close second, with nearly 85 per cent of the respondents categorising the future prospects as grim. Several experts are of the view that the aviation sector needs government support as it has high fixed costs. The sector is highly leveraged and is among the worst-hit sectors.
HospitalityThe hospitality sector in India also took a serious beating. The sector declined considerably in the first quarter of 2020, due to the COVID-19 outbreak.Covid-19 pandemic, along with coronavirus triggered lockdown, resulted in a sharp fall in domestic as well as foreign travel. Travel restrictions across the globe further worsened the situation.
Automobile50 per cent of them in the automobile sector feel the chances of revival appear gloomy in the near future. The auto sector recorded its worst sales in April, 2020.The magnitude of the blow of COVID-19 pandemic and the nationwide lockdown were felt when the sector recorded absolute zero sales in the month of April 2020. It was the first such month in the history of the Indian auto sector.
MSME sectorIn the Micro, Small & Medium Enterprises (MSME) sector, 60 per cent of the respondents view a bleak recovery in the future.