The Second Wave of COVID19: Hospitality and Education Sectors to Suffer the Most

The second wave of the coronavirus infections is going to hit every sector of the economy. If the daily numbers of infections remain very high for a longer period, it will derail the business confidence to some extent and slow down the recovery cycle in the economy. A part of the economic recovery and the improving sentiments and the confidence in the economy is expected to reverse due to the increasing COVID19 infections and falling mobility in the economy. But it must be noted that Indian economy, like all other economies, has adjusted to the new but harsh realities relating to the Coronavirus pandemic. Due to this, the recovery process is not going to halt and is expected to continue but at a slower rate than expected. However, the hospitality and education sectors along with the allied sectors will have to bear the brunt of the second wave of the COVID19 infections the most.

In the first wave, the hospitality and education sectors along with the allied sectors were hit the hardest and had to be completely closed due to very high infection possibilities and lack of systematic confidence in handling pandemic situations relating to COVID19. The recovery process in these sectors along with the other sectors of the economy had started accelerating amid a lot of uncertainties after the COVID19 curve had flattened but these sectors now again have to be partially closed and wouldn’t be able to function at its full strength due to the essential restrictions and high possibilities of infections. This will make the situation even grim for these sectors. Most importantly, these sectors have not got much attention in the budget 2021-22 as well. Perhaps the government had anticipated that it would take longer than expected for these sectors to recover from the pandemic shock. Also from the experiences of the other countries as well as the people getting carefree, the second wave of the infections was well expected.

Unlike the education sector, the hospitality sector along with the travel and tourism industry had been facing a very difficult time for many months as the industry had to satisfy with no revenues or hardly any revenues because of the nation wide lockdown, mobility restriction and the resultant dipped consumers’ confidence. However, of late, the situation in the hospitality and travel and tourism industry was improving but the second wave has now changed the whole landscape again.

Both the hospitality and education sectors are in trouble but due to the peculiar nature of the education sector where enrollment of students takes place only once in a year in the months of March-July and the sector doesn't have any possibility of getting new enrollments during rest of the year, unlike the hospitality sector which can acquire new customers any time during year. This is the reason why the private players in the education sector in general and particularly in rural India are facing perhaps one of the toughest times due to very few new admissions caused by the pandemic related fear. Their survival is now in question as the government sector educational institutes are having edge due to public financing (for good reasons) and have become a desirable preference in rural areas due to the falling income of the parents.

If the governments in states have changed their perspective, orientation and outlook towards the private players in the education sector and really want to promote the public sector over the private sector, then it is really good for the whole nation as it will make the schooling less expensive for the parents and equal for the students (as the private schools create some artificial barriers for the students coming from the unprivileged sections of the society). For this, the respective governments in the states have to improve the capacities of the schools and upgrade the infrastructures. But if there is no such intention, the governments must not leave the private schools as abandoned children! Though, there is not much positive sentiment in the public about the private players in the education sector, shooting the bird in the eye for no reasons makes no sense and will make the private schools of rural India more vulnerable and less effective which over time have become the backbone of the school system in rural India (historically the enrollments of students from middle and upper middle classes in the government schools had been falling for years). In such a situation, these private institutions must get some support and flexibility in the enrollment process of the students to increase activities in the education sector and other allied sectors.
Rajeev Upadhyay

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