Published 06:20 IST, February 26th 2020
Coronavirus outbreak affects Indian firms in China, could lose 15-20% revenue: CII
A recent analysis published by the Confederation of Indian Industry (CII) shows that Indian firms operating in China could lose 15-20% revenue due to outbreak
- India News
- 2 min read
A recent report published by the Confederation of Indian Industry (CII) shows that Indian firms operating in China could lose 15-20% revenue due to coronavirus outbreak. According to the analysis, Indian IT companies operating in China have already been badly hit by the outbreak as their global customers have started looking for other service providers in alternate locations such as Malaysia, Vietnam, etc. As IT companies are heavily dependent on manpower, they are not able to operate effectively due to strict restrictions in the movement of people. According to the survey, there are around 130 Indian companies currently operating out of China.
"The extended Lunar New Year holidays in China have adversely impacted the revenue and growth of Indian IT companies, operating out of China. IT companies are heavily dependent on manpower and are not able to operate due to restrictions in the movement of people arising from lockdown and quarantine issues. Consequently, they are not able to complete/deliver the existing projects in time and are also declining new projects," the survey said in its analysis in the context of several cities that are under lockdown.
The survey also estimated that the outbreak would result in an economic slowdown in China and suggested that the country's GDP would decelerate by 1-1.25 percentage point over 2020. The survey further said that the lockdown affecting 500 million people in China will deeply impact its consumption of goods as the country is the world’s largest exporter and second largest importing nation, accounting for 13% of world exports and 11% of world imports.
Coronavirus outbreak
China is currently battling the novel coronavirus that has claimed more than 2,700 lives across the globe and has infected over 80,000 people since December 2019. According to reports, at least 27 people have died outside mainland China, which makes it the worst disease outbreak in the 21st century. The virus originated from a seafood market in Wuhan city, where animals were being traded illegally. Hubei province in China has been most affected by the contagious disease, which is also the epicentre of the virus.
Updated 06:20 IST, February 26th 2020