‘Shrinking workforce, lack of demand affecting MSMEs’
LUCKNOW: In a detailed note presented to chief minister Yogi Adityanath on Thursday, micro, small and medium enterprises (MSMEs) underscored the problems being faced by them in running their units amid the pandemic.
The industry lobby bodies apprised the chief minister that despite the government’s announcement to keep the industry running during the ongoing partial corona curfew, there was a lack of demand in the market. With all economic activity coming to a standstill, the MSMEs said they wanted to close their units till the situation normalised as their production had been affected. Though the state government has exempted industrial activity from corona curfew, production and maintenance work has been affected in almost all units.
“If the situation continues like this, we will be left with no option but to shut down our units till the situation normalises,” said Manmohan Agarwal, senior vice president, Indian Industries Association (IIA).
The IIA also apprised the state government that business activity was not possible in the event of a lockdown in containment zones. A disrupted supply chain and low work force have reduced production to bare minimum at industrial units in Noida, Meerut and other parts of the state. “The government has issued a government order permitting industrial activity even in this second wave of the pandemic. But workers have left for their homes out of fear,” said Rajiv Bansal, national secretary, IIA. Bansal said the workforce had shrunk to 5,000 from 50,000 in Noida even when factories were not shut.
Problems highlighted by industrialists: MSME capacity is limited
It is not possible to store raw materials in large quantities. The unpredictable adverse effect of rise in prices of raw materials is impacting industries.
Delivery offices of transport companies
Delivery offices of transport companies have been shut during the ongoing corona curfew. As a result, material of entrepreneurs, machinery parts among other items which have been imported from outside, are dumped. These offices must be allowed to reopen.
Tools not available
Running the industry requires daily consumables such as V-belts, bearings, electric motors, electric bindings and parts, electric workshops and other tools, which the entrepreneur purchase from local market. Instructions must be issued for opening of mill stores, engineering tools and kits shops for at least two days a week.
Price of steel rising
Steel industry is affected by reduction in production. As the steel price has increased, it should be brought under the Essential Commodities Act to check price rise.
Economic package
For entrepreneurs, who had taken bank loans, the government had implemented a moratorium for one year on payment of loans. This period will expire this month. It must be extended for another year, they said..