Any more lockdowns enforced by COVID-19 may not necessarily control the spread of the virus but will surely impact businesses, hit employment, and cripple the economy, industrialist Rahul Bajaj warned.
Addressing shareholders for the final time as the Chairman of Bajaj Auto, the 83-year-old Bajaj – also one of the most outspoken of India Inc. bosses - said, “Let us hope that rapidly accelerated vaccinations coupled with a strict enforcement of masks and social distancing will soon bring the second wave under control. Let us also hope that we do not react to the epidemic by declaring more lockdowns, as we did the last time. For these will destroy business, employment and the economy without necessarily controlling the spread of the disease.”
The six-week lockdown announced during the first wave of the pandemic last year, April to May, saw automotive factories and showrooms shutdown overnight across the country.
Production and demand came back on stream only during the festive season later in 2020.
But following a surge in new COVID-19 cases by March 2021, as many as 20 states declared lockdowns and imposed restrictions on the movement of people.
As a result, business was hit again in April and May before some relief was visible in the second half of June.
As against 151,000 units during FY21, Bajaj Auto’s average domestic monthly sales of two-wheeler, fell to 93,500 units during April and May this year.
The Pune-based company makes bikes under the brands Pulsar, Avenger, KTM and Husqvarna. While Bajaj Auto’s financial performance for Q1FY22 is awaited, the company saw its net profit falling more than half during Q1FY21 compared to Q1FY20 due to the COVID-19 disruption.
“There is enough evidence to show that lockdowns have not worked to limit the spread of the virus. Instead, such lockdowns create massive economic uncertainty; threaten the livelihood of daily workers and the poor; prompt needless urban-to-rural migration; and sharply accentuate fears in an already fearful milieu. That will be an unmitigated disaster,” the management discussion and analysis attached in the annual report of Bajaj Auto added.
“The solution is a combination of strictly enforced safety — involving masks and basic social distancing — coupled with a rapidly accelerated vaccination programme. And, subject to basic safety and inoculation, work must continue. For that is what brings in the daily bread, feeds home and hearth and makes a nation grow,” the report further added.
Rahul Bajaj who has been one of the longest serving chairman in corporate India, stepped down from the role after holding the position for nearly five decades.
He has been made Chairman Emeritus while cousin Niraj Bajaj has been appointed as Chairman. Rajiv Bajaj will continue as the company’s Managing Director.
“This is my last Chairman’s letter to you. Though I shan’t write to you through this forum any further, rest assured that you and your company will forever remain in my heart,” Bajaj added.
