In congested areas, where social distancing is impossible, traders have decided to remain shut even after the restrictions are relaxed. More than 60% of retail outlets in major markets including Colaba, Nariman Point and Andheri in Mumbai and Khan Market, Connaught Place and Sadar Bazar in New Delhi are occupied by tenants, traders said. Many have defaulted on rent, they said.
Rent for a 1,000 square-foot shop can be as high as Rs 5 lakh a month in Khan Market and Rs 3 lakh in Breach Candy area, said Praveen Khandelwal, secretary general of the Confederation of All India Traders. “At least 20% of Indian retailers’ business will collapse and they will wind up businesses. About 10% of other traders who are dependent on these 20% traders, too, will collapse,” he said.
In Delhi’s old markets, shopkeepers who pay rents of Rs 4-5 lakh a month are scared, said Sanjay Bhargava, president of Chandni Chowk Sarv Vyaapaar Mandal. Most rent agreements have a force majeure clause and it has been invoked. Traders are trying to manage on their own with savings. “We will not be requesting or expecting relief from the government,” said Bhargava.
Ajay Bajaj, senior advisor to Confederation of Sadar Bazar Traders Association in Delhi, said rentals are expected to fall more than 50% once lockdown goes.
Ram Lal, president of the Gaffar Market Traders Association, said, “Our only advice to shop owners and tenants (unable to pay) is that they should resolve the issue mutually and pay at least 50% of the rental.”
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15 Comments on this Story
navneet kapoor240 days ago
Time for 'realty' check. Rentals at retail destinations had gone beyond above permissible limit and they had been a bone of contention for plenty of businesses. This is a god sent opportunity for well deserved correction asking for a rental 'reboot' across locations.
With COVID19 here to stay realignment of rentals is a must for business cycle to remain intact.
Sameer 251 days ago
it was just a matter of time, waiting to happen.
Nageswara Rao S252 days ago
no regrets if a shop is closed which is paying 5 lacs pm rental.