Tirupati: Covid-hit small industries desperately look for cash flow

A view of Ravands Plastech unit at Puthalapattu (Representational picture)

A view of Ravands Plastech unit at Puthalapattu (Representational picture)


  • Pandemic pushes the sector into a state of uncertainty
  • The MSMEs are facing severe fund crunch and lack of marketing opportunities
  • Looking for sops from the government to sustain in the field

Tirupati: The Covid-19 pandemic has laid a serious impact on micro, small and medium enterprises (MSMEs) on many fronts. This potential sector which contributes a major share to the GDP of the country has been now struggling with fund crunch, reduced capacity to create employment and put them in a state of uncertainty over their future.

The complete lockdown during the first wave and partial lockdown this year have severely hampered the prospects of the sector. Following the closure of all units for several months the production capacity of the sector has dwindled resulting in severe fund crunch. The enterprises have been facing another major problem with poor marketing potential for the past one year.

The entrepreneurs have been saying that they will have marketing opportunities with private consumers as well as the government. As the pandemic forced people also to restrict their spending activities to a great extent which may not improve soon, the government should take initiative and resume its purchasings from MSMEs. This will revive the cash flow and help the enterprises in a big way.

In the same breath, steps have to be taken to increase the purchasing power of consumers. This will restart the economic cycle. As of now, most of the enterprises have laid-off the workers and the workers from other states have left for their homes.

It was learnt that there are around 4,000 MSMEs with a turnover of about Rs 6,000 crores are there in Chittoor district apart from many other unregistered units. These units employ more than 1.5 lakh workforce and the uncertainty in the sector has brought difficulties to all of them.

Many units have been left with meagre funds that may last for another 2-3 months. Unless the economy is revived by then, many units have to be shut down, said an entrepreneur.

D Damodar of Ravands Palstech in Puthalapattu told The Hans India that the government should take immediate steps to help the sector. First, the payments of EMIs should be postponed for another six months to help the enterprises financially.

The existing facility of paying PF and ESI for fresh and re-appointed workers by the central government should be continued for some more time. The government should also consider reducing the interest rates to help the sector. Finally, they should release the pending subsidies to increase the cash flow which will make a major impact.

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