The beleaguered retail industry expects a slew of relief measures to help it tide over challenging times as it struggles with footfalls and low sales again, amid the third wave of the Covid pandemic. Additionally, the industry is also looking forward to announcements around a National Retail Policy, restructuring of GST formalities and initiatives to boost consumption in the upcoming union budget.
“The two years of the pandemic have impacted many in the poorer sections of the population. Many were without jobs thanks to reverse migration and lockdowns. Any scheme that helps increase the spending power of the poor would be welcome,” said Kumar Rajagopalan, CEO, Retailers Association of India (RAI).
Similarly, he added, the salaried class of the population also needs to get more money in their hands to help them consume with confidence. “Rising inflation is a worry, and this can be faced better only with more money in the hands of the consuming class,” he said.
Companies operating in the retail sector are also seeking a few reforms around GST. “We hope that the finance minister will consider restructuring GST formalities, specifically the delay in getting input credit by monthly filers due to quarterly filing of returns by quarterly filers,” said Shivendra Nigam, CFO, Cantabil Retail India.
Rajagopalan, meanwhile, feels the government needs to give the industry a better direction for the implementation of GST. “Any increase in GST on clothing, food and housing creates a direct impact on consumption. A direction for a more predictable GST regime would be welcome. Similarly, many clauses around carrying forward and refund of GST needs clarification,” he added.
Last September, the GST Council had decided to correct the inverted duty structure on textiles and footwear from January 1 and hiked the GST rate to 12 percent from 5 percent. After a backlash from the industry, which said the increase would impact demand, especially given the inflationary situation, the Council deferred the rate hike on textiles in December but went ahead with its decision on footwear.
The retail industry expects the finance minister to announce a slew of measures to help the beleaguered retail industry. Mall owners, for instance, are demanding a moratorium on loans.
“During the first lockdown, shopping malls were offered a moratorium on loans for an extended period of seven-eight months, but no such relief was given to us during the second wave, which was even more severe,” said Gurvineet Singh, CEO of Thane-based Viviana Mall. “With the third wave, the retail industry has been hit again and a moratorium on loans will help it sustain,” he added.
For some years now, mall owners have also been demanding infrastructure status for shopping centres, which would help them gain access to institutional funding at much lower borrowing rates and help the industry survive in these challenging times.
The retailers are also expecting announcements around a National Retail Policy, a long pending demand from the industry. The policy will make it easier for retailers to set up shops and ensure ease of doing business, a much-awaited reform by the industry.
“Several licences and compliances are required currently to open even a small store; bringing a National Retail Policy into the picture will make the processes hassle-free for us,” said Vineet Jain, COO, V-Mart Retail.Besides these, the retail industry is also seeking MSME and ECLGS (Emergency Credit Line Guarantee Scheme) support for retail and a policy around digitisation.