As far as the Indian perspective is concerned, the 14 week long lockdown due to COVID-19 had a massive negative impact on the economy with the shuttering of India’s $2.9 trillion economy. Industrial production plunged by 16.7 percent in March (year on year), within a week of the lockdown. In the manufacturing sector, the Purchasing Managers’ Index (PMI), which is a method to calculate near-term economic activity, contracted significantly in April and May. The PMI for services had the lowest reading ever recorded globally (5.4). Aside from agriculture, all other major sectors of the economy, particularly construction, real estate, retail trade, transport and manufacturing were in a slump during the first quarter of 2020.
The COVID-19 pandemic is quite possibly the greatest crisis that the world has seen and resultantly has caused seismic shifts in the economy, consumer behaviour and the overall commercial functioning of the world. The Government of India introduced following changes to ease the burden on businesses and economy. Some of the highlights are as follows:
Ease of banking in India
The Reserve Bank of India introduced a moratorium on repayments of loan amounts by borrows to lenders, in order to mitigate the pressure on borrowers to continue regular repayment of their loan amounts.
There has been much debate on whether accumulated interest on the loan repayments shall be applicable or not and the matter is pending before the Hon’ble Supreme Court. The Solicitor General has assured the Court that banks will waive interest charged on loans of up to Rs. 2 crores, which shall be compensated by the government.
Ease of Doing Business in India
Multiple relief packages and schemes were introduced for hand holding the flailing businesses, particularly in the MSME sector.
The Central Government, to ease the burden on companies in India, introduced relaxations such as relaxation in holding board meetings, board meetings through video conferencing, delayed statutory filings etc.
Several state governments also provided exemption from working hours as provided under the Factories Act, 1948 so as to curb the crises of unavailability of factory workers. The Madhya Pradesh and Uttar Pradesh state governments also exempted new factories from certain provisions of Industrial Disputes Act, 1947 and eased certain compliances under various other labour laws to provide ease in doing business to the employers.
The integration of all the existing labour laws into four codes by the central government is also a step in the right direction as it will simplify the compliances required under the different acts and will provide for uniform definitions of terms like workmen, salary/wage etc. which will help in reducing the burden of compliances and provide the employers with ease of doing business in the country.
Relief for employees
The Central Government provided both employers and employees of certain establishments which have less than 100 employees and 90% of the employees earn wages less than INR 15,000 relief from contribution under the Employees Provident Fund Scheme (“EPF”) by paying 24% contribution (12% of employer and 12% of employee) to the employees EPF account till August 2020.
Improved dispute resolution mechanism in India post-Covid
While it may be true that pandemic has badly affected all activities across the world but certainly it has paved ways for much needed overhauling in the dispute resolution system in India which is functioning much better online as one can see and realize following advantages:
With one email, the documents such as petitions, replies, affidavits etc. get filed in the court and served to all concerned parties.
Counsels can use their time more constructively as they attend the online hearings while sitting in their office when their matter is called.
Repeated adjournments on account of non-availability of counsels of either side, will now be a history as they can attend the hearing from anywhere.
During the hearings, documents like, judgments to be cited, can be shared online and hence the hearing can be conducted smoothly and without being adjourned on the pretext of the documents not readily available or to be filed at a later date.
In arbitration proceedings, it is realized that most of the tribunals are able to fix the matter in immediate future rather than giving the next date after a gap of 2-3 months. Thus, early disposal of the matter has become a reality.
The Arbitrators can attend the hearing from anywhere and there is no limitation of timings of the hearings, which used to be great hurdle earlier, now parties are following the practice of submitting their respective submissions in writing in advance of the online hearings, which also helps in making the oral presentation more effective and time saving.
It has resulted in cost savings to the litigants involved in arbitration proceedings as the costs and planning the logistics of the travel for concerned was a costly affair
During the online hearing, all concerned try to be accommodative to ensure that hearings are conducted smoothly. Technical objections of various kinds have automatically died and there is a better coordination between offices of counsels and court staffs
Few challenges presently being faced in online hearings would be addressed in times to come and hopefully we will all see a very effective, efficient and expeditious and most desirable dispute resolution framework in place.
Our outlook in India
Several sectors such as show below have tapped into this time and turned it into an opportunity for growth.
- Information technology
- Digital and video enabled apps
- FMCG and retail
- Healthcare and pharmaceuticals
There is some cautious optimism amongst agencies like the IMF and UNCTAD as well, which have independently stated that India is expected to rebound in 2021. The IMF anticipates India’s rebound in 2021 with 8.8 percent growth. Even as per UNCTAD, India’s GDP is forecast to contract 5.9% in 2020 and recover to 3.9% next year.
-  India’s post–COVID-19 economic recovery: The M&A imperative, McKinsey & Company; July 2020
-  Kavaljit Singh “COVID-19 Has Pushed the Indian Economy Into a Tailspin. But There’s a Way Out”, (The Wire) < https://thewire.in/economy/covid-19-india-economic-recovery> last accessed on 15 October 2020.
-  World Economic Outlook, “A Long and Difficult Ascent”; October 2020
-  UNCTAD; Trade And Development Report “The Covid-19 Shock to Developing Countries: Towards a “whatever it takes” programme for the two-thirds of the world’s population being left behind”; March 2020
|· Adani Green Energy Limited
· Axis Bank
· Dedicated Freight Corridor Corporation of India Limited
· Grofers India Pvt. Ltd.
· Gujarat Maritime Board
· Indian Railways
· ISGEC Heavy Engineering Limited
· Liberty Shoes Limited
· National Highways Authority of India
· National Highway Infrastructure Development Corporation Limited
· Power Finance Corporation
· Ramky Infrastructures Limited
· Shapoorji Pallonji & Company Ltd-
· State Bank of India
|· American Bureau of Shipping
· ARRI Motion picture company
· Case New Holland
· Clinton Health Access Initiative
· IJM Corporation (BHD), Malaysia
· Deloitte Touche Tohmatsu
· Denel (SOC) Ltd.
· GROHE India
· Inmarsat India Pvt. Ltd.
· IQoR India Pvt. Ltd.
· Kelly Services India
· McGraw Hill Education India Private Limited
· O.C. Tanner
· Oxford University Press
· Sinosteel Equipment and Engineering Co. Ltd.
· S&P Global
· The Nature Conservancy
· Tiger Coatings GmbH
· Toyota Material Handling India Pvt. Ltd.
· Tupperware India Pvt. Ltd.