New Delhi, May 10: The deadly SARS hasn’t come to India — at least not officially. But the Indian economy isn’t insulated from the effects of the virus that threatens to trammel growth in Asia, especially China and South East Asia.
Industry associations across Asia need to join hands and cooperate with each other to limit the impact that the virus could have on their economies which until recently were the fastest growing in the world.
China and India remain two of the fastest growing economies in the world even though the tiger economies of South-East Asia have wilted in the heat of the meltdown in 1997.
“The deleterious impact of SARS, aggravated by a growing uncertainty, could affect many more sectors in Asia including productivity, profitability, trade and foreign investments,” says a Ficci report on SARS impact and imperatives for intra-Asian cooperation.
The report states, “This is a call enough for Asian economies to respond, combine resources on enhancing their joint ability to uncover and contain the spread of deadly virus threatening to paralyse growth and prosperity of Asia and the global economy.”
The sudden outbreak and continuous spread of SARS is another “blow to confidence along with the Iraq war, downtrend in the US and European growth and economic recession in Japan,” says the chamber.
The SARS outbreak has hit sectors like travel and tourism, retail industries, airlines, electronics and manufacturing. ANA (Japanese airlines) reported that passenger traffic between Tokyo and Hong Kong fell by a fifth after the disease was identified.
A sharp fall in the inbound travellers in affected countries has caused hotel occupancy rates to fall. According to a survey by Deloitte and Touch in March 2003, hotels across Asia experienced a 4.6 per cent decline in revenue per available room when measured in US dollars.
The Taiwanese electronics companies are avoiding sending their employees to vital factories in southern China. Taiwan has also temporarily suspended an important new shipping link to China.
Despite varying patterns of industrial growth, trade, services and investment networks within Asia, it appears that several countries in the region may get affected since the extent of intra-regional trade in goods and services within Asia has grown significantly, says Ficci.