Mall developers and shopping centre owners have sought immediate relief from the government and financial institutions including an extended moratorium on loans, access to short-term financing, a one-time loan restructuring, and flexibility in depositing GST to help tide over the Covid-19 crisis. The Shopping Centres Association of India (SCAI) has said that over the last two months, the organised retail industry has suffered losses of over Rs 90,000 crore and large-scale unemployment is a real possibility in the absence of financial relief and government support.
“The organised retail industry is in distress and has not earned anything since the lockdown and oussr survival is at stake. While the extension of the loan moratorium talks about some relief on repayment but won’t help the industry in liquidity. A long-term beneficial plan from the government is much required to revive the second biggest contributor to our country’s GDP,” said Amitabh Taneja, chairman, SCAI. Mall owners are requesting financial institutions to consider extending the penalty-free moratorium period till March 31, 2021, and also allow a one-time loan restructuring for shopping centres.
They said, there is a dire need for short-term financing options for a 6-12 month period at lower interest rates to meet the increased working capital requirements. Retailers operating in these malls are also pushing for rental waivers in absence of business. However, there seems to be an impasse between landlords and retailers.
“Since we are not earning anything as of now, it would be difficult to pass on any significant benefit to our partners. We are looking at giving some liquidity to our retail partners so that they can repay the rent after some time… The pain needs to be understood from both sides and we are trying to come up with a working solution with reasonableness from both sides,” said Arjun Sharma, Chairman, Select Group. SCAI has also sought that GST rebates be granted to offset the losses on account of and for the period of closure of business. It is seeking flexibility in deposit of GST as that needs to be done immediately upon raising of invoice, while corresponding payments are likely to be much delayed and shall further result in a cash-flow crunch at shopping centres.