International SME Day 2021 – Know theme, significance and what small businesses want from governments at Centre, states – All you want to know!
The damage to the Micro, Small and Medium Enterprises during the second wave of Coronavirus pandemic has been much more severe and widespread than the first wave, Ajit Lakra, Managing Director (MD) at Superfine Knitters told SME Editor Saurabh Manchanda of Zee Business
•Updated: July 22, 2021 14:46 pm
The damage to the Micro, Small and Medium Enterprises during the second wave of Coronavirus pandemic has been much more severe and widespread than the first wave, Ajit Lakra, Managing Director (MD) at Superfine Knitters told SME Editor Saurabh Manchanda of Zee Business.
Superfine Knitters is a Punjab-based textile company which supplies knitting fabrics to export companies manufacturing knitted garments.
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Lakra was speaking during a panel discussion on MSME Day which is observed on June 27 every year. United Nations has been observing this day as an MSME Day since 2017 to recognise the contribution of these industries in the implementation of the Sustainable Development Goals (SDGs).
International MSMEs Day 2021: The theme of the Micro, Small and Medium-sized Enterprises Day for this edition was ‘MSME 2021: the key to an inclusive and sustainable recovery’. The UN has hosted a series of events to explore how MSMEs — the backbone of our economies can be equipped to ensure an equitable and sustainable post-COVID-19 recovery.
As several states across the country were holding lockdowns and other restrictions, manufacturing was hit there was and there was a halt in the retail activity, the MD said.
Lakra said that the Central Government has been doing its bit to help the sector including the extensions of the Emergency Credit Line Guarantee Scheme (ECLGS) where the interest rates are capped, and the repayment tenure has been increased. He however emphasised for more help, recommending even lower interest rates. Stressed units could see a faster revival at interest rates around 2-3 per cent, he further said.
A lower interest rate will ensure that the units are up and running. The government’s revenues will also go up once the stressed units restart operations, he pointed out.
Ramesh Babu, Founder of Ramesh Tours and Travel said that the fund reserves during the first wave helped many people in the sector, sail through. That was not the case during the second wave, he added. Babu also called for lower interest rates, seconding, Lakra’s views. He said that tourism industry has been hit badly especially the small operators. Babu was also one of the co-panellists in the discussion.
Calling it (Covid-19 pandemic) unprecedented, Lakra said that the government must ensure more liquidity in the system. He said that the banks should take a lead to reach out to stressed units and provide funds in an expeditious manner.
BM Balakrishna, Founder of Aquapot – a water treatment equipment and services company - said that the pandemic has hit small and medium enterprises twice in one year. The second phase was even severe, he added. The running cost of businesses have exceeded the daily sales. He was of the view that technology could be a big enabler in sustaining businesses. His own company is working on digital transformation of its operations.
Lakra also said that the NPA classification norms must be revisited. He further said that those units which have become stressed should not be declared NPAs (Non-performing Assets). A five-year loan moratorium period should be declared for such units, he further said.
Babu also lauded the vaccination drive of the government and was hopeful that by December most part of the adult population would be vaccinated by this time. He said that this will likely have a positive impact on the businesses. He said that both domestic and international travel will likely increase once the two doses are administered.
He also wanted government help on issues related to taxes and insurances.
Both, Lakra and Babu also sought help from the state governments.
Balakrishna said that his company has been empathetic to the problems of its employees and has paid full salaries despite work disruptions.
- For many units, there is less work now which is not commensurate with the employee headcount in the companies.
- In labour intensive works, companies are facing shortages as the sowing season has started and labours go back.
- Taxes should be deferred
- Interest rates should be lowered and units should be given a chance for revival.
- Both the Centre and state should come forward to help the MSME sector.
- Banks should approach the small businesses, assess the current situation and extend help accordingly.
This event was sponsored by several clients, Presented by Coinswitch Kuber, Driven by Skoda. E commerce partner wasTata Cliq while special partner was Go Daddy. The banking partner of this event was Canara Bank while technology partner was Dell.