PANJIM: The continuing ban on mining is having a deleterious effect on the sale of automobiles and there is nothing on the horizon to suggest that this situation will change for the better.
To make matters worse there seems to be a total absence of any plan to help improve the state of the economy. This rather glum view was articulated by Paresh Joshi during the course of a conversation with the Herald.
As president of the Goa Automobile Dealers Association, Paresh felt that the year ahead would not mean an increase in the sale of cars in the state. He said “There was a whiff in the air when people thought that the ban on mining would be lifted. This was last year I am talking about. People felt it would commence by July August and hence sales during Ganpati was good. Sentiments had improved but the ban was not lifted. By December- January people realised that it was not going to be very soon. The environmental clearances were not in place. Hence we had another spell of slowdown which continues.”
There was however a mild increase in sales in March as individuals and companies purchased four wheelers to get the benefit of depreciation. April is again very slow and as he emphasised the dependence on mining is very obvious and it had to resume for the economy to bounce back. The Goa market he said 1200-1500 a month market for four wheelers. A good season would mean 1500 a month. Now however the sales had dropped by 25% and generally for over two years it has not been a viable business to be in given the high overheads.
This he said was not only unique to Goa with his contacts claiming that sentiments in parts of the country were equally very poor. Some he said would even contemplate shutting down business rather than keep operating in a market where there was no sustainable business. He however felt that with the new government at the Centre the reforms which had been initiated would kick in by September and the economy both at the national and state level would benefit.
The government he said was allocating funds for projects and the money would enter the local economy by September and October, the start of the festive season. He went on to explain that the Rs 5000 crore allocated for the Mandovi bridge would certainly help the local market with local personnel and expertise being used for its construction. Their salaries would be a boost for the economy. The state economy had a big hole given that Rs 8000 crore that used to come from the mining sector was not coming in any more. The salaries paid to staff in that sector, payments to equipment suppliers like trucks, barges etc was not coming into the market any more.
Now, he said with road development starting after the monsoon, people would have money. Another boost could be the Rs 32,000 crore for Goa Shipyard over a period of 10 years allocated by the defence minister for the manufacture of defence equipment. This he said would percolate into the local economy. People he said lived in hope that one day the mining industry would start functioning again.
With regards to the automobile market in the state, people he said who earlier had Maruti 800’s were now upgrading to hatchbacks with more features. This was he said a very price sensitive market with the cars in the Rs 3 to 7 lakh price range always being the largest and most competitive segment. Another segment which was witnessing some competition was the Rs 7-12 lakh space with people looking to upgrade. The mini SUV market he said was capable of absorbing 250 cars a month.
The state he felt had to reinvigorate itself by promoting itself as an IT hub. The state had certain advantages with the people have a mastery over the English language but the absence of facilities was glaring. People who are employed in these sectors are paid a decent salary which means they would be interested in buying cars or even a new house. But it was he said a pity that nothing was being done despite talk of the investment policy.
The next five years in his words would be more trouble unless something drastic was done to sort the present situation. The problem he said for car dealers in Goa was one of an absence of large volumes with a population of just 15 lakhs. This meant that something new ie a paradigm shift was necessary so that Goa could witness happy times yet again.
