News Karnataka
Thursday, April 25 2024

Recent lockdowns and night curfews may put a hurdle on India’s sale of fuels

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As the numbers of Covid cases are rising at an alarming rate in India, more states like Karnataka, Maharashtra are going for a lockdown or night curfew. Maharashtra, with a record number of cases, has controlled the supply and movement of non-essential commodities and asked all the private companies to direct their employees to work from home. Many state governments are performing their duties with around 50% attendance and hence the movement of traffic has reduced to a great extent on the roads. Lesser number of people are going to the offices and doing their official duty from home. Hence traffic has gone down to a great extent in the busy streets of Bangalore, India’s commercial capital of Mumbai, and all other busy metropolises where the virus has spread to a great extent.

Most of the schools are going for online classes till the age of Class 9 and degree colleges are also closed. People who can play casino games are sitting from the comfort of their home and playing online games either from their office computer and Smartphone. In the last lockdown held last year, it was seen that the revenue of online casino companies went up to a great extent as people had nowhere to go and sit at home and play the casino games. People, who have an interest in sports, do a lot of sports betting. During the lockdown period, it was found that many Karnataka residents did sports betting from their homes as they have enough leisure time. In such cases, people must play through some reliable Thailand betting sites so that they get maximum return on their investment and their investment is also not wasted.

Daily infections from Covid are touching almost 170,000 each day, leading to overcrowding of hospitals and shortage of vaccines in the second most popular country in the world. India has overtaken Brazil as the second most infected country after Brazil. This has compelled some of the states to go for a lockdown or partial shutdown just to break the chain of this virus. As a result of this, the number of traffic on the road has gone down to a great extent in the major cities of the country.

This is not a good sign for the Indian economy as far as consumption of fuel is concerned. During the national lockdown last year, demand for fuel went down to a minimum and was recorded as the lowest since the year 2007. As the movement of traffic is declining in these cities, demand for crude consumption went down by 2 percent in the month of March from February. As more states are planning to go for a lockdown, the consumption of oil products is expected to go down further in the coming months. This is an alarming sign for the oil companies who are recovering from the fall in demand which they saw last year during the lockdown period. But the only good sign is that the Government may not go for a full lockdown which they did in the previous year.

All these restrictions have already beginning to hit the Indian economy on the roads. In the week ending April 11th, unemployment has gone up to 8.6%. Barely two weeks ago, the figure stood at 6.7%, according to data available with the Centre for Monitoring Indian Economy. The suffering is more in the urban areas, with the jobless rates touching 10 percent.

All these factors raise alarm for energy demand in India. Diesel consumption accounts for 40% of total sales of all oil products as this is the fuel that keeps the factories, farms, and trucks moving on the road. The sale of diesel in March 2021 was 3 percent lower than the corresponding period in March 2019. Industry experts are of the view that the growth of fuel sales is maybe around 30% higher than what it was in the corresponding period last year when the entire nation went for a complete lockdown from 23rd March 2020. Fuel sales were the lowest at that time of the year.

After the lockdown period, people preferred to use scooters and cars for commuting for the purpose of safety reasons. Because of this reason, the demand for motor fuel went up by 27% than what it was in the corresponding period last year. The night curfew and work from home restrictions will lower even that demand for motor fuel in the coming months.

India is the third-largest importer of crude oil and a little drop in demand for fuel may have an impact on the price of crude in the international market. However, that fall in demand may be substituted by China, where the Government has tackled the Covid situation much better than the US, thus making the way for a more powerful economy than the USA.

Another serious issue that can be seen is the return of migrant laborers to their home state in millions. Last time, they faced a huge risk as the Central Government called for a sudden lockdown and they got stuck on the highways, railway stations, and even in stables in many places. At that time, all local trains and buses were called off the road and they were left behind in pathetic misery. They are not taking any chance this time and have started their journey back to their home state in trains and buses. This has again raised a big question mark on the infrastructure projects in the country.

As a result of this, thousands of real estate projects in Karnataka are held back, keeping the flat owners in the dark. Delivery of projects is getting delayed and they are being punished by Real Estate Regulatory Authority-Karnataka (RERA-K). But the flat owners are not getting the compensation which they deserve and they are running from pillar to post for that. RERA has given 448 compensation orders to the builders around 183 crores, out of which the developers have paid only 1.63 crores. The mass return of the migrant laborers is expected to aggravate this situation further.


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