oppn parties Uber, Ola And Economic Recession

News Snippets

  • Flipkart assures employees that there will be no job or salary cuts due to the COVID-19 pandemic
  • Although it was obvious, but the government still clarifies that there is no need to switch off appliances and only lights need to be switched off on April 5 at 9pm after confusion in the minds of some people
  • PM Modi and President Trump decide "to deploy full strength of (Indo-US) partnership" to fight against COVID-19
  • 17 states have reported 1023 cases of coronavirus linked to the Tablighi Jamaat, which translates to 30% of all positive cases in India
  • The government says people should not use alcohol-based hand sanitizers before lighting diyas or candles on April 5
  • The railways say there is no certainty yet when services will resume after the lockdown and a final decision will be taken in the next few days
  • As coronavirus cases multiply in Assam, six north-east states seal their borders with the state
  • Power System Operation Corporation Ltd. (POCOSO) putting all systems and protocols in place at war-footing to ensure there is no grid failure due to reduction in demand on April 5 at 9 pm
  • Power ministry scotches rumours that the power grid might fail due to the 9-minute blackout called by PM Modi on Sunday, April 5
  • Centre asks people to wear home-made masks if it is absolutely essential for them to step out of homes
  • Centre asks states to allow licensed street vendors to sell essential items
  • 8000 samples were tested across India on April 2, but the government said that testing will be need-based and will not be used as a confidence-boosting measure
  • Air India operating special flights to fly passengers stuck in India since the lockdown
  • For the first time in history, Darjeeling loses first flush tea due to suspension of garden work for Covid-19 outbreak
  • Supreme Court asks journalists to be responsible and publish only the official version of news after it was brought to its notice that migrant exodus started after the 'fake' news that the lockdown will be extended to three months
Total count stands ar 3082 as India records 16 Covid-19 deaths, the highest in a single day
oppn parties
Uber, Ola And Economic Recession

By Linus Garg

About the Author

Sunil Garodia Linus tackles things head-on. He takes sides in his analysis and it fits excellently with our editorial policy. No 'maybe's' and 'allegedly' for him, only things in black and white.

Finance Minister Nirmala Sitharaman has said that the auto industry is suffering low sales as millennials prefer to ride on Uber and Ola instead of owning cars to avoid the hassle of driving and looking for parking slots. This is once again a classic example of a government not willing to acknowledge a problem and looking for excuses to explain the slowdown in the economy.

Sitharaman should know that preference for riding on Uber and Ola can be one of the minor reasons but can never be one of the main reasons for the precarious position the auto industry finds itself in. On the other hand, car sales are being driven by Ola and Uber because as demand rises for such rides, people are investing in cars to run them on the app-based platforms.

Further, it is not only the sales of cars that have plummeted. Demand has fallen across the board for all kinds of vehicles, including two-wheelers and commercial vehicles. App-based platforms cannot be held responsible for that. It is lack of manufacturing activity and falling profitability for businessmen and lack of jobs and no rise in salaries for the salaried-class that is preventing them from investing in acquiring new assets.

The finance minister must be aware that auto sales have been going down for 10 straight months now. She must also be aware that GDP growth rate is going down, companies are reporting lower sales in their quarterly results, manufacturing has contracted for the last few months and credit off-take has slowed down to a trickle. All this taken together shows that the economy is in recession.

Hence, instead of looking for excuses or responding in knee-jerk fashion, the finance minister should apply her mind and think of structural reforms. She should find the money to invest in infrastructure to perk up demand. The government must not sleep on the matter and instead must tackle it on a war footing.