Can we expect this festive season to renew consumer sentiment for good as the worst economic slowdown in last six years continues? Read on as Gehna Sharma, 3rd year, BA (H) Economics, analyses the Indian economy during the festive season.
The festive season is everyone’s favourite. Some like it for the celebrations while some just drool over the holidays that come in this season! The businessmen and retailers have a different reason to fall for the festive season though – it’s this season that brings home about a quarter of their annual revenue. The festivities commence with Onam celebrations and continue till Diwali. Navratri, Durga Pooja, and Dussehra along with some Jain and Sikh holidays are a few other festivals celebrated during this time period.
The celebrations around this time of the year call for extravagance, shopping sprees, and retail therapy. Besides, custom requires the majority of us to spend considerable fractions of our savings on making long-awaited purchases of assets, jewelry, cars or even real estate. We probably believe too much in the pleas for prosperity that we make to Goddess Lakshmi, as we let cash flow effortlessly through our pockets during the Diwali season without worrying much about savings.
But then there are also some of us, for whom the last-minute shopping and trips to the neighborhood market seem like a never-ending ordeal as guests start taking over our abode and long-lost relatives show up at odd hours of the day!
While the festive season sales’ contribution to the national output is not to be undermined, it is still left for us to decipher how this festive season, in particular, will shape the growth figures of the Indian economy.
Going by a recent Economic Times report, consumption picked up in the first weekend of this particular festive season with net sales in the fashion and apparel, smartphone and consumer electronics categories snowballing at a great pace.
While this may seem like good news, the truth is that short term spurts in demand attributable to the festivities merely help in improving the short-term consumption demand and a slew of long-term reforms are needed overall. The government’s inability to do something concrete to improve the overall consumer demand is partly responsible for a slowdown which will continue well into the festival season.
The common man, small and medium scale enterprises have all been hit hard by the negative sentiment spread across the economy currently, with the current unemployment levels only adding up to it. Even as students we have all felt this crippling fear as the uncertainty surrounding the job market grows and there is no guarantee of securing decent placements even with the best of grades.
Although the conundrum our economy finds itself in paved the way for sellers like Amazon, Flipkart to offer massive discounts and to come up with a combination of easy payment schemes specially designed keeping in mind the festivities to lure us into buying - we still have a long and treacherous way to go before we can reinforce the projected growth figures of seven or eight percent as the economic slowdown continues.
All in all, the picture of India’s economic growth may seem bleak when focused on. The economy is yet to witness the dramatic upsurge in its operations that will heave it out of the clutches of the worst slowdown that it has witnessed in the last six years.
Meanwhile, I guess it’s time for me to get back to cleaning my room for the annual Diwali cleaning bonanza with the hopes that this festive season, it’s not just rockets shooting up but our economy too!