AAP seeks bailout for Covid-hit small businesses, employees

Bengaluru: The State unit of the Aam Aadmi Party on Wednesday raised a pitch for financially supporting employees of small and medium businesses who are severely affected due to the lockdown.

The party said that the period of the lockdown in the first two weeks did not include the shutting down of manufacturing units but the next four weeks was a

shut-down for all "non-essential" manufacturing as well.

"The lockdown has seriously affected the viability and cash-position of tiny, small and medium businesses, already reeling under the impact of last year's lockdown and the slow and often broken recovery thereafter.

With this lockdown, several of them are being forced to close shop completely, not having the funds to sustain themselves and not having a clear picture of how the future of their business will unfold. Others are struggling to survive, since they have no alternative to livelihood," Vice President, AAP, Bengaluru B T Naganna said.

He stated that small and medium businesses account for a large majority of the working population of the State, and a substantial share of State GDP as well. "Ignoring their needs and letting them close will make the State stumble from the Covid crisis to an economic crisis of the largest proportions that we may ever see in the last 50 years, at least," Naganna added.

He added that that large businesses in Karnataka and in India have profited at the expense of the tiny, small and medium ones in this last year. "The rising share prices of top companies, the growing wealth of the richest like Gautam Adani clearly indicate that. They have ready access to banks and funds, to political connections and they have the scale to beat down the smaller businesses. In this lockdown, they will further increase their market share and deliver knock-out blows to the small businesses who employ most of the workers," he elaborated.

Naganna added while small businesses have got no relief in power costs due the lockdown, one of the major suppliers of power to the State, Adani Power, has shown record profit growth in the last one year. "No effort has been made by the State Power Minister (also the Chief Minister) to reduce the prices paid to Adani Power even though these prices are 40% higher than the levels 2 years ago!," he highlighted. AAP also suggested that Karnataka Govt should show foresight, consideration and genuine support for the tiny, small and Medium businesses who actually are the lifeline of the economy instead of the currying favour with the large corporations and business houses.

AAP proposal

♦ 100% waiver of fixed power, water and other rates for the lockdown period and 50% reduction in variable rates.

♦ 100% waiver of property taxes and other commercial rates for properties where businesses are operating.

♦ Provision of PF and ESI payments (both company and employee share) during the period of lockdown.

♦ Interest-free working capital loan equal to one month of sales, to be repaid over three years in equal installments starting from Apr 2022.

♦ Enabling deferral of all loan repayment for the period of lockdown and 2 months thereafter, with no additional interest burden.

♦ Reconstruction finance at nominal interest rates to businesses forced to shut shop or stall expansion plans during the lockdown.