Coronavirus update: Automakers may resume manufacturing operations soon in India

In a letter to the Ministry of Home Affairs, the Ministry of Commerce has suggested of allowing big industries, like auto manufacturing units, to resume production with 20-25% capacity. 

As you might already know by now, the ongoing lockdown due to the COVID-19 outbreak has been extended in India till May 3, 2020. However, while most of us will have to sit and work from home for the next 19 days, the auto industry may resume manufacturing operations sooner than that.

In a letter to the Ministry of Home Affairs, the Ministry of Commerce has suggested the government to allow ‘certain more activities’ in addition to the essential services during the current lockdown, in order to improve the ‘economic activity' as well as to 'provide liquidity in the hands of public’. In simpler terms, the ministry has suggested that big companies, like auto manufacturing units, with ‘reasonable safeguards’ should be allowed to resume operations during the lockdown.

The Ministry of Commerce has advised that the manufacturing should be allowed to operate with 20-25% capacity or a single shift to start with. The Ministry of Commerce adds that the companies should only be permitted to start operations with minimum manpower, along with proper social distancing and sanitation norms in place.

In his speech earlier today, Prime Minister Narendra Modi, too, hinted that some relaxation may be allowed after April 20 in areas where there are no ‘hotspots’ and the situation isn’t that critical. And this could very well be the glimmer of hope that the Indian auto industry was wishing for.

Having said that, it won’t be smooth sailing for automakers once they resume operations. The Indian auto industry witnessed a decline of 51% in passenger vehicle sales in March 2020, which was mainly down to the ongoing Coronavirus crisis that resulted in a 21-day lockdown starting from March 23. So, to get back on their feet and running, it’ll definitely be a long road to recovery for the auto industry.

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