Hope reigns, but industries sceptical of growth

Karnataka is a land of opportunities. The state, known for its skilled human resources, salubrious weather and infrastructure, is one of the most sought-after destinations for investors from across the world. To chart out a vision document to ensure the state’s growth at a faster pace, The New Indian Express is bringing together thought leaders and experts from various sectors.At conclave `Vision-2025’ on January 1, 2018,  experts will highlight pertinent issues and present their visions to convert challenges into opportunities. Challenges to ensure infrastructure development, especially in Bengaluru that is growing at a phenomenal rate; making our educational institutions world class; measures to retain top spot in attracting Foreign Direct Investment (FDI) by improving ease of doing business; and measures to make agriculture sustainable at a time when farm sector is facing a crisis situation, will be among the topics discussed at the conclave. The conclave will be attended by political and business leaders, top bureaucrats and members of the civil society who play an important role in the development of the state. In the run-up to the conclave, The New Indian Express is bringing you a series of interviews and stories focusing on Vision 2025.

BENGALURU: Recovering from a temporary slowdown in the industrial sector, entrepreneurs, especially from Small and Medium Enterprises, are still sceptical about their prospects in the immediate future. Though there is some ‘buoyancy’ in IT sector, experts feel that a lot of its growth is riding on new legislation that may or may not be introduced in the USA.Some industrialists are also concerned about the sedentary phase of administration in the run-up to the elections.

Ashok Pamidi, Senior Director, NASSCOM, told The New Indian Express that although growth was somewhat disturbed, IT and associated industries have remained buoyant. This was during a period of uncertainty associated with domestic -- and especially US policies -- which threatened to hamper growth in the sector. “While no clear policies have come from the US, IT industry is cautious. We are sceptical about new laws in the USA and are geared up for any eventuality,” he said.Despite concerns, he said that there was a boom in Karnataka as engineering, research and development is seeing major growth.

After the challenges faced by the industrial sector in 2017, business is now settling down, said K Ravi, president of Federation of Karnataka Chamber of Commerce and Industry. “The major concern is that manufacturing is on hold and there are several apprehensions related to the end of the financial year,” he said. The state has been able to attract some good investments even though there were many problems during the financial year, he said.

According to Hanumanthe Gowda, president of Karnataka State Small Industries Association (KASSIA), the condition of small industries is still bad. “Demonetisation and implementation of GST have affected us badly. Our units are not getting any orders. Even if we get them, the quantity of orders are less and we are starved of cash due to delay in payments,” he said.

He said it is difficult to predict till when the stress on small industries will last. “Every day, our business is going in a negative direction. In order for us to settle from the impact of GST, it will take six months at least,” he said. At such a juncture, the Centre should consider reducing interest rates or restructuring loans of SMEs, he added.

Former president of KASSIA, A Padmanabha said the condition is better than it was six months ago.
“Demand is still less and has to increase. Government has to come up with projects to help us and increase sales for SMEs,” he said.