City MSMEs still drenched in misery

The discomfort has certainly risen and the ‘unease’ factor has crept into business, especially as weekly wage payments to labourers, apart from cost of logistics have been real pain points for the MSMEs. CK Mohan, General Secretary, TANSTIA (the apex body of 150 industry associations and 2,500 plus individual members), says “Nearly 50 per cent of the industries have not come back to life. At least four months of business has been lost.”

The CM in a memorandum last year, had sought aid from the National Disaster Response Fund, to the extent of Rs 8,481 crores for infrastructural restoration. While those with insurance are trying to resolve their claim settlements, those operating without insurance are left with no straw to hold on to. Ancillary units have been the worst hit. Though some units have bounced back, it is disheartening to note that MNCs too have been shifting their orders to other states. 

The apex industry body claims that several representations have been made to the Centre and the state but lack of coordination, among other factors, have brought things to a standstill. Apparently, meetings with the Finance Ministry too have not yielded any effect. Mohan seeks to point out that funding is only for infrastructure, boats and agriculture kind of activities and as such excludes the industry. “The execution of the demonetisation leaves a lot to be desired. The minimal withdrawal rules, changing by the day, has hit businesses hard. There is no money to pay transporters and even those in finished goods business have been finding it extremely difficult to pay the logistics and diesel costs. At petrol bunks, transactions of Rs 200 are not entertained,” he said, adding weekly wage cash payments have suffered. 

On the other end, PB Varadharajan, President, Renewable Energy Harvesting Environment Network Association (RENA), a non-profit consortium of energy firms with turnovers exceeding Rs 100 crore, says, “It is difficult to quantify losses. Have you seen a drop or rise in power consumption? Do you see petrol offtake decrease or increase? Has there been a dip in bank credit? So, things are as they were. However, a big growth opportunity has been lost,” he said, adding that efforts had been taken up to tide over the deluge challenge which showed in the visible clean-up though innovative methods of handling water had not yet surfaced. 

Expecting the businesses to register a 10 per cent growth in the next year, he said he sees as a “boom” time as the “ground reality is many of the enterprises are sure to clock in 40 per cent additional revenues over the previous year.” “Four of them have grown ten times in the last four years, accounting for 90 per cent of the Rs 100 crore revenues,” he sought to point out.