#Coronavirus: 500,000 Restaurants In India Asked To Shut Down; Most Airlines Will Go Bankrupt By May
The Covid-19 Pandemic has caused the economy of many countries to fall sharply!
The Covid-19 pandemic has forced The National Restaurant Association of India (NRAI), representing over 500,000 eateries across India, has asked its members to close businesses till March 31.
Aviation Consultancy Centre for Asia Pacific Aviation (CAPA) said, the pandemic is also expected to cause the airlines across the globe to go bankrupt by the end of May, 2020.
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Restaurants and Eateries Closed in India?
Earlier the advisory issued by several state governments had asked malls, pubs, spas, gyms and multiplexes to shut down till March 31. The state governments have also restricted the gathering of more than 50 people.
Anurag Katriar, President of NRAI said, “We were in discussion on this matter for the past 24 hours with our members. So we have now decided to advise our members to suspend operations of their restaurants till March 31. We feel this step needs to be taken keeping in mind the safety and health of our employees as well as guests.”
Additionally he said, “While this will lead to losses for the industry but as responsible corporate citizens we believe it’s our duty to take such a measure for the safety of employees as well as customers.”
The Indian Railways has also cancelled 85 low-occupancy trains to contain the coronavirus. Railways employees and catering staff with fever, cough, runny nose or difficulty in breathing were barred from the “business of food handling”.
Airline Companies Approaching Bankruptcy due to Covid-19 Pandemic!
CAPA’s statement regarding bankruptcy has come at a time when airlines across the globe are curbing flights and grounding aircraft due to various travel restrictions imposed by countries, prompting people to steer clear of their travel plans.
The world’s three airline alliances- Star Alliance, Oneworld and SkyTeam constituting almost 60 airlines around the world that contribute more than half of global airline capacity- together sought support of the governments to drift over the crisis caused by the covid-19 pandemic.
The trio said in a joint statement, “To alleviate the immense pressures faced by airlines in the current operating environment, and in support of IATA’s statement on 12 March, the three alliances urge governments worldwide to prepare for the broad economic effects from actions taken by states to contain the spread of Covid-19, and to evaluate all possible means to assist the airline industry during this unprecedented period.”
CAPA said, “As the impact of the coronavirus and multiple government travel reactions sweep through our world, many airlines have probably already been driven into technical bankruptcy, or are at least substantially in breach of debt covenants. Cash reserves are running down quickly as fleets are grounded and what flights there are operate much less than half full.”
The discouragement from the government from flying has led to cancellations outweighing the forward bookings. The demand is becoming scarce in ways that are completely unprecedented.
CAPA said, “Coordinated government and industry action is needed – now – if catastrophe is to be avoided.” The consultancy also warned that governments that are failing to cooperate and while they are scrambling with the health challenges of coronavirus makes it clear that there is little inclination to act cooperatively.
CAPA also said referring to the travel ban imposed by the U.S. on flights to and from European countries, “Each nation is adopting the solution that appears best suited to it, right or wrong, without consideration of its neighbours or trading partners.”
India has also shut itself not only for foreign nationals but also the Overseas Citizen of India (OCI) cardholders.
Even before the Indian government announced its decision to close the country from Friday, several foreign and international airline companies had cancelled over 500 flights to and from India. With the new restrictions being imposed, the airlines have begun to reduce capacity to and from India. Qatar Airways and Delta Air Lines, besides some African carriers have already reduced capacity into the Indian market while others are reviewing the situation.