Seeking a financial package to prevent a “collapse in the economic order” of the country, Gujarat-based Gandhidham Chamber of Commerce and Industry has written a letter to Union Finance Minister Nirmala Sitharaman seeking more liquidity for survival of industries and prevent job loss.
“Prior to the coronavirus, there were concerns about the slowdown. But now because of the lockdown, the economic cycle is disrupted. The workers have been asked not to report to duty and all this will add to the disruption,” Anil Kumar Jain, president of the Gandhidham Chamber of Commerce and Industry, told The lndian Express.
The letter from the 67-year trade body with 2,700 members asked the finance minister to direct banks to enhance “working capital limits by 20 per cent for those borrowers who need cash to tide over the crisis”. This move, according to the chamber, will also help avoid job loss.
“The inventory is going to pile up and the government has asked the workers to be paid regularly, despite having no production. The expenses are rising and we do not know how long this situation will continue… we are predicting a 20 per cent enhancement in working capital to be given to help the factories and businesses,” Jain added.
In the list of demands, the Chamber has sought the finance minister’s intervention in preventing banks from recovering interest or EMI for six months from borrowers who are unable to pay. “RBI must declare a six month moratorium on NPA classification enabling all banks not to pursue recovery.”
On Monday, Gujarat Chief Minister Vijay Rupani held a meeting with representatives of various industrial association and trade bodies to chalk out a strategy that will see them through the crisis. The state government has already told the industries and businesses in Gujarat to not lay off employees or cut salaries.
“In the meeting with the CM, people talked about the areas that needed immediate attention. For instance, as far as MSMEs are concerned, cash flow needs urgent attention and addressing the NPA issue by amending norms giving some moratorium or by converting interest into a term loan,” said Durgesh Buch, president of Ahmedabad-based Gujarat Chamber of Commerce and industry. He said if such steps are not taken then businesses will slip into a “negative cycle”.
He claimed that industries in Gujarat are “committed to look after their human resource”.
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