MSME Organisation Endorsed National Lockdown But Urged Policymakers for Necessary Economic Package

All India Manufacturers Organisation, (AIMO) an Apex trade body focused on the interests of the MSME sector endorsed that the Lockdown announced due to the Corona Virus was absolutely essential. AIMO made a plea to the Government that if the right support Packages, Incentives and measures were not provided to the MSME’s the Lockdown could well turn into a ShutDown India.

According to Mr Sampath Raman, Chairman, Karnataka State Board (AIMO), “We would like to acknowledge the steps taken by the Finance Minister regarding the easing of Compliance which was taken to ease the business situation. Several sectors like Automobile, Aviation, Hospitality, Apparel, Consumer Durables, Electronics, Hotels, Tourism, Restaurants and Bars, The Entertainment Industry, Airlines, BPO, Seafood and Livestock, Construction and Real Estate, Transportation are among the worst hit by this epidemic. All the MSME’s / Self Employed Individuals / Entrepreneurs associated OR whose revenues depend either directly or indirectly on these sectors have been on the verge of a Shutdown situation.”

Mr Jaganath Reddy, Zonal VP, South, AIMO added, “According to our reports from our members and State Boards and their clusters of the MSME sector over the past few weeks across the country, over 60 odd million MSME’s are in REAL danger due to Market issues with Over 92% drop in domestic sales compared to the same time last year, Over 100% drop in export sales compared to the same time last year, Apart from the manufacturers, Our services industry players in Tourism, Hotel, retail and entertainment have suffered a MAJOR impact. Contrary to popular opinion, even our online startups have seen a huge decline in demand except for the Healthcare startups and some even have an unsold Inventory increase of about 58% currently. MSMEs re feeling the Impact of Inter-State restrictions on transportation of goods and impact of Import restrictions from China has hit many of our Entrepreneurs as a source of raw material.”

“ MSMEs are facing Complete Loss of revenues, COMPOUNDED with extended credit cycles impacting Statutory payments like PF / ESI / GST/TDS/TAXES/Term Loans and Interest Payments, Our members and their associates are unable to pay wages to staff due to lack of revenue and lack of production. Late delivery charges or cancellation of orders or demurrages. “Added Mr Reddy

“Work from Home (WFH) is applicable to less than 8% of the core MSME and Services sector and also WFH has seen a drop in over 63% productivity in the service industry. The Services sector has seen mass migration of Labour to the villages.” Said Mr. Sampath Raman Founded by Bharat Ratna Sir

“ AIMO has requested the Finance Minister to waiver Bank Interest like it was done for Farmers, Instruct banks not to make Entrepreneurs’ as NPA for lack of interest payment till Dec 31st 2020. If certain banks and airlines and Corporates bailed out even the certain MSME’s should be bailed out considering MSMEs employ over 121 million people in this country. If Indian Banks write off large sums of loans of Large Corporates why the struggling Entrepreneur community are being harassed for recovery even though their loans are fully secured using SARFASI act. Freeze on Litigations for a period of 6 months to enable Entrepreneurs to find their feet back and focus on business. “Stressed Mr Reddy

Finally Mr Sampath Raman said, “We request the Government Provide a Stipend of Rs.6000 pm per worker employed by MSME’s /START UPs directly to the employees for a period of 6 months or till the Corona situation is under control. Please provide a Scheme for relaxation of Statutory Payments from MSME’s for a period of 6 months to ESI and PF. The government should URGENTLY look at Discussing and Formulating and IMPLMENTING policies for FORMS OF UNIVERSAL BASIC INCOME and UNEMPLOYMENT INSURANCE. “

“In conclusion we would like to reiterate that AIMO India is a Trade body that is focused on the MSME sector across India. We are more than ready to support you in your endeavors especially to provide the last mile connectivity to the MSME community in India. “Concluded Mr Reddy

We at AIMO believe that one of India’s biggest assets are our Entrepreneurs and that segment cannot be allowed to die. Survival of every existing Entrepreneur equals creating two fresh new entrepreneurs. The above suggestions are required on war footing basis. The crisis of MSME/STARTUP can also be called as National Calamity and addressed. If we miss this last opportunity, then we might not have any.