People carrying luggage pass barricades placed at the Ramganj coronavirus hotspot in Jaipur, Rajasthan.(Himanshu Vyas/ Hindustan Times)
People carrying luggage pass barricades placed at the Ramganj coronavirus hotspot in Jaipur, Rajasthan.(Himanshu Vyas/ Hindustan Times)

Industrialists in state voice discontent with govt stimulus package

In the survey, 83.2% of respondents mentioned that the stimulus package was “not so effective”, 15% respondents found it “effective” and 1.8% found it “very effective”.
Hindustan Times, Jaipur | By HT Correspondent
UPDATED ON MAY 31, 2020 02:22 PM IST

More than 80 percent industrialists in Rajasthan, a majority of them owning micro, small and medium enterprises (MSMEs), are dissatisfied with the centre’s stimulus package, FICCI has found in a survey.

The online survey by the Federation of Indian Chambers of Commerce and Industry or FICCI included 107 industry members, mostly of MSMEs in Jaipur, Jodhpur, Udaipur, Kota, Ajmer, Bhiwadi, Alwar and Bhilwara to capture the status of operations, feedback on migration of labourers and the Rs 29 lakh crore stimulus package announced by the centre recently.

In the survey, 83.2% of respondents mentioned that the stimulus package was “not so effective”, 15% respondents found it “effective” and 1.8% found it “very effective”.

Atul Sharma, director, FICCI Rajasthan state council, said most of the small and medium industries were looking at a relief package instead of a stimulus package. “These units are under financial burden as they are not getting any revenue, but there is cash outflow. So, they were looking at some relief in expenses and some kind of grants from the government,” he said.

He said the industry association had apprised the state government and the centre of its demand before the package was announced. “The three main components of the package were waiver of fixed charges in electricity bills for the lockdown period, help in payment of salaries to workers in the lockdown and waiving interest on loans. However, these have not been met,” he said.

According to the survey, 72% respondents said migration of labourers has affected their business.

Sharma said the government’s recent initiative to create an online labour employment exchange is a good idea. “This is a good initiative and would help the existing and new industries in finding human resource as per their needs. There are many established portals for white collar jobs but this one is a great initiative for blue collar jobs,” he said.

Almost 90 percent respondents in the survey said their capacity utilisation is below 50 percent. The survey found that 27.1% respondents are operating at less than 10% capacity, 32.7% respondents are doing capacity utilisation between 10% and 25%, 89.7% respondents are doing capacity utilisation of less than 50% and 2.8% respondents indicated capacity utilisation above 75%.

Sharma said this is partly due to labour shortage, but mainly due to lack of demand.

“There is no place to send the material to as there is no demand,” he said.

Ashok Kajaria, chairman, FICCI Rajasthan State Council & CMD, Kajaria Ceramics Ltd said, “We hope Lockdown 5.0 or Exit 1.0 would bring more positive changes and liberal guidelines as now thrust of both central and state government is on reviving the economy.”

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