April 10, 2020 10:44:34 pm
Poor cash flow and fear of future business are among the top two concerns of the Micro, Small and Medium Enterprises (MSMEs) in Pune region. According to a survey conducted recently by the Mahratta Chamber of Commerce Industries and Agriculture (MCCIA), around 40 per cent of respondents were unsure on whether they would be reducing salaries of their employees.
The survey, results of which were made public on Friday, had seen participation of 398 companies (231 manufacturing and 166 services companies).
Prashant Girbane, director general of the MCCIA said the survey gauged the sentiments of the companies during the lockdown. “The survey showed 95 per cent respondents rate cash flow and fear of future business as the top two concerns. Importantly, 45 per cent of them expressed confidence that they would not cut salaries of their employees, while 40 per cent were uncertain about it. The survey also saw 64 per cent of the respondents worried about impending reduction in orders while 23 per cent have already started feeling the pinch,” Girbane said. “Most MSMEs have accounted for salaries and wages to be paid until April 14, when the nationwide lockdown is supposed to end. However, they are uncertain about it thereafter. As many as 77 per cent of respondents believe their trade receivables are under high risk,” the survey stated.
Pradeep Bhargava, president of MCCIA, said they have shared the concerns of the companies with both the state and central government. “A list of suggestions has been shared to help the industries during these trying times. One of the top suggestions to the Centre was extension of cash credit limit to the sector by 20 per cent without demanding any extra documentations. Similarly, the government dues to the MSMEs are estimated to be around Rs 1 lakh crore, which needs to be released immediately,” Bhargava said.
The MCCIA has asked the government to take the liability of PF for the employees for the first quarter of the 2020-21 financial year. “Payment of ESIC for the first quarter also be waived off as the ESIC already has a corpus of Rs 70,000 crore,” the recommendations read. Both these measures would result in saving of around 15 per cent in the wage bills for the companies. Waiver of property tax, electricity charges and other fixed charges also formed the charter of demand from the chamber for the sector.
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