India’s COVID-19 lockdown: Dabur, Pure Nutrition, and Akay weigh in on economic impacts

The global COVID-19 pandemic has left several countries across the globe in an unprecedented state of lockdown and India is one of the latest to join the long list of countries which have imposed the most stringent control measures.

The country entered a three-week lockdown since last Wednesday (March 25).

As part of the arrangements, all industrial establishments will be closed, except for manufacturing of essential commodities and production units which require continuous process after obtaining permission from the state government.

Dabur India is one of the companies affected and had to suspend several manufacturing units.

However, the company told NutraIngredients-Asia ​that ayurvedic medicines, such as its flagship product, Chyawanprash – a cooked mixture of honey, ghee, spices, and herbs – was considered essential products and thus manufacturing would continue.

“Complying with the government’s directive, we have temporarily suspended production at our manufacturing units, except for essential products like Ayurvedic medicines, Chyawanprash, hand sanitisers, hand wash in the interest of the public,” ​executive director-operations Shahrukh Khan said.

However, not all companies producing supplements have continued with production, as they were unclear of their business status.

Health supplement firm Pure Nutrition said it has stopped production of its health supplements since the first day of the lockdown.

It has since written to the government for it to be considered as an ‘essential’ business. It is expecting a confirmation from the authorities early this week, CEO and director, Sushil Khaitan said.

He said that sales of immune-boosting products such as vitamin C, curcumin, zinc, selenium, detox lungs, and probiotics products have been growing since the outbreak.

“We are trying to raise awareness in the public, through the digital and social media, giving them the information on what to do to avoid the virus. We are utilizing influencers and nutritionists to write about the importance of nutrients for stronger immunity and anti-viral purposes,” ​he said.

Functional spice supplier Akay Ingredients had also stopped all of its manufacturing.

“We could approach the authorities for considering us as an essential commodities business, but we put the health and safety of our employees first, and will watch how the situation develop,” ​Emmanuel Nambusseril, chief marketing officer said.  ​

Role of health supplements ​

Echoing the views of the companies, an industry expert has stressed the imperative of continuing the production of nutraceuticals.

Sandeep Gupta, chief founder and director of the Expert Nutraceutical Advocacy Council (ENAC) said that there has been no clarification from the authorities as to whether the supplement sector was considered an ‘essential’ commodity.

“It has to be clarified by the government. The manufacturing and supply of supplements should not be disrupted, because if supplements are not supplied, it can damage the health of the nation,”​ he said, giving examples of how micronutrients such as vitamins and compounds such as astaxanthin could boost the immune system.

He has written to government units, such as the Ministry of AYUSH, Ministry of Health and Family Welfare, and the Ministry of Commerce and Industry to advocate the cause. 

“There could be no better time for testing and propagating the benefits of nutraceuticals and health supplements as safe health care products which help in enhancing natural immunity and works as preventive medicine,”​ he wrote in the letters.

Supply chain losses ​

Financial losses from supply chain disruptions are starting to loom large for a number of firms. 

Akay Ingredients said that its shipments for exports were stuck as most of the port facilities were closed, with the problem further exacerbated by a lack of information on freight services.

Within India, many of the firm’s consignments were also stuck at transporting hubs.

“Since March is India’s end of the fiscal year, we were planning to ship out the maximum, and geared up our production with that plan. Unfortunately, many shipments got stuck. Even finished ingredients could not be shipped out.​

“We were not able to ship even 30% of what was planned for the month. If you estimate the shortfall in value terms, it is in excess of USD$8m,” ​Nambusseril said.

The company’s remaining stocks in warehouses in the US and Germany are expected to last until end April or beginning of May.

Pure Nutrition, on the other hand, said it has sufficient inventory in the US, UK and Europe through Amazon, but noted that there would be a supply gap in April.

Swisse, which entered India via e-commerce earlier this month​, said it would monitor the evolving situation, and proactively work to deliver its products to consumers, said Akash Bedi, chief strategy and operations officer at H&H Group – the parent company of the brand.

E-commerce disruption ​

E-commerce services in the country have also experienced repercussions.

According to surveys conducted by India’s social network platform LocalCircles, the percentage of customers who were unable to buy essential goods via e-commerce shot up from 35% to 79% between March 20 – 22 and March 23 – 24.  

Pure Nutrition, which has both online and offline presence in pharmacies and airports, said its e-commerce product delivery was affected as only ‘essential’ commodities could be delivered to consumers.

In the pharmacy retail, there has been a shortage of its products seen due to high demand for immune products.