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India Shuts Factories, Locks Down Country for 21 Days to Contain Coronavirus Crisis

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Starting Wednesday, India will be under complete lockdown as it looks to stave off the coronavirus pandemic that is quickly spreading within its borders.

Some parts of the country had been locked down for the past two days, but starting Wednesday, movement will be restricted nationwide for the next 21 days, with limited exceptions.

“From 12 midnight tonight, the entire country will go under a complete lockdown,” Indian Prime Minister Narendra Modi said Tuesday. “To save India and every Indian, there will be a total ban on venturing out of your homes. Every state, every union territory, every district, every village and every locality is being put under a lockdown.”

That means factories will be shuttered until April 14, and already pressured production could face further strain.

When talk had originally surfaced about the lockdown lasting for one week, Ritesh Nair, co-founder of India-based sustainable sourcing company Iipi Sourcing, said, “Yes, there are orders being impacted, but if it’s a matter of a week, the gap will be covered up without much delay.”

Now that the lockdown will be three times longer than first expected, the impact is less certain. The pandemic’s spread, however, is more certain.

“It will have different implications depending on the customers associated with the factories,” he said. “The biggest impact will be for factories dealing with the fast fashion and mass market retailers just because of the scale of volume and the economics involved. Having said that, at the other end of the spectrum, smaller factories who have lesser capital and cash flow reserves could also be impacted.”

On Monday, the World Health Organization (WHO) reported 415 confirmed cases of COVID-19 in India. On Tuesday, India’s health ministry said that number had climbed to 536, following trends seen elsewhere around the world. While the count may be small for a country with 1.3 billion people, the government’s aim is to quickly prevent things from getting out of hand.

All commercial and private establishments that aren’t dealing in critical needs, like food stuffs and medical supplies, will now be closed. All manufacturing facilities, with the exception of those producing “essential commodities” must remain shuttered.

Communications did not further outline what will be considered an essential commodity, but already the apparel factories are closed. Transportation services in some places have also ground to halt. Non-exempt citizens found breaking the stay-at-home order could face imprisonment.

During the lockdown, according to Nair, the government has asked all industries to retain their staff so that salaries would not be impacted while their mobility is banned. India is expected to announce plans for business support and an economic stimulus package in the coming days.

“Most factory owners are planning to support the workers at this time to the very best extent possible,” he said. “Many State governments are also working on providing cash support & food ration support to the daily wage workers whether in apparel or in any other industry.”

Because the lockdown will also drive down demand, some don’t believe the impacts will be all that far reaching.

“Shops and malls across India are closed and demand too is down. Hence the factory closure will not impact business much,” Kamal Nandi, business head at Godrej Appliances and president of electronics industry body CEAMA, told India’s Economic Times. “Apparel and lifestyle goods brands have also shut their factories.”

Nair, however, feels the impact could be greater than Nandi suggests, and he’s sitting with a “deep worry” about the potential impact on businesses in both the short and long term.

“The apparel sector is such a time driven machine that a three-week interruption can have severe repercussions on most of the apparel factories and ancillary services,” he said. “However, since this is a global threat facing all of us right now, we all have to stay positive and believe in each other–both customers as well as suppliers [will] bounce back and recover together.”

How things progress or slow in terms of the virus spread over the next three weeks will determine what happens next in India. But for now, Modi has emphasized the severity of his order.

“The next 21 days are crucial for us, as per health experts, a minimum of 21 days is most crucial to break the cycle of infection,” he said. “If we are not able to manage this pandemic in the next 21 days, the country and your family will be setback by 21 years.”

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