© Reuters. Workers are seen inside the kitchen of a dhaba, a small restaurant along a national highway in Gharaunda, in the northern state of Haryana, India, on June 17, 2021. REUTERS / Adnan Abidi
By Manoj Kumar and Sunil Kataria
KARNAL, India (Reuters) – Asin Sharma lies inactive on a cot near her restaurant along a highway linking India’s capital New Delhi with the northern state of Punjab.
Few motorists stop at the line of five open roadside restaurants on this stretch of road. Those who cautiously venture inside only ask for tea and water. The restaurant’s tandoor, a traditional clay oven used to make flatbreads, is cold and unused.
“We are in a very bad situation and the restaurant is on the verge of death,” said the 35-year-old. “We do not have work and many expenses to face. Our condition is pathetic.”
Restaurants or “dhabas” are ubiquitous in India. Tens of thousands line national highways, but many are now struggling to survive while customers stay home despite several state governments relaxing traffic restrictions due to coronavirus.
Many dhabas are run by families and employ millions, including locals and migrant workers. The problems they now face are part of a broader malaise in the travel and leisure industry, and in the Indian economy in general.
India reported 62,480 new daily cases on Friday, a significant decline from a peak of more than 400,000 on May 9 during its second wave of COVID-19 infections. Given the low vaccination rates, experts are already warning of a third wave later this year.
Economists fear the sector will face weakness in the next year, even if the government can vaccinate most of India’s roughly 1.4 billion people. Only 6% are fully vaccinated now.
FIGHT TO SURVIVE
Last year, the government extended federal guarantees on bank loans for small businesses, including hotels and restaurants, as well as a moratorium on some bank loans until the end of March. Some restaurant owners have already received notices from banks to repay these loans.
Last month, Finance Ministry officials said the government could consider more measures for restaurants later this year. A spokesperson declined to comment further on the plans.
Restaurant owners interviewed said that many could be forced to close their businesses permanently in the absence of more support from the government. Others said they would likely delay bank loans, defer payments and sell properties if the third wave hits. Most have cut wages and laid off staff.
Sonu Sharma, manager of Mannat Haveli restaurant, says that in normal times the restaurant is so busy that they have a staff of 300, but now there are only 50-60 people at work.
These unemployed migrant workers have been forced to resort to low-paid agricultural work. Huge job losses in the restaurant sector reflect a broader rise in unemployment in India, which nearly doubled to 11.9% in May from 6.5% in March, according to CMIE, a think tank based in Mumbai.
On the road between New Delhi and Mumbai, India’s financial hub, Hans Restaurant, which used to thrive on catering for weddings and birthday parties, has tried to survive by selling takeout, but there aren’t enough orders, manager Kailash said. Chand Meghwal.
“We never thought we would see a day like this,” he said. “Almost 80% of our staff have returned to their villages.”
Fusion Media or anyone involved with Fusion Media will not accept any responsibility for loss or damage as a result of reliance on information, including data, quotes, charts, and buy / sell signals contained on this website. Be fully informed about the risks and costs associated with trading the financial markets, it is one of the riskiest forms of investment possible.