Medium, small companies in Gurgon fear closure, seek bailout by government

Shubhra Pant | TNN | Apr 14, 2020, 07:28 IST

Gurgaon: Struggling to survive due to the Covid-19 lockdown, the micro, small and medium enterprises (MSME) in the city have written to the Prime Minister’s Office and the chief minister’s office, seeking an immediate bailout package for the sector.
Under the banner of Industrial Development Association, these organisations have claimed that they are being forced to pay the workers despite not getting any payments from their clients. With manufacturing currently suspended and their savings running out, these MSMEs anticipate a bloodbath over the next quarter. At least 50% MSMEs face the risk of closure in the next month itself, they claim.
“Unlike large corporations, MSMEs have no corpus to save our businesses. The government must come forward to take immediate preventive measures and disburse sums necessary and unprecedented exemptions to save MSMEs,” said Depak Maini, chairmain of Industrial Development Association.
According to Maini, who owns a manufacturing unit in the city, immediate government intervention is the need of the hour to save the jobs of our workers. “The employers are under tremendous fear of prosecution in case of non-compliance of the directive issued under the Disaster Management Act, 2005, and the Epidemic Diseases Act 1897 which appears to be a one-sided approach,” they wrote.
Among other things, the sector has also sought deferment of EMIs for at least six months. “The assumption that the companies will be able to pay once the lockdown is over is also unfit. We are facing problems from all sides. Our savings are also depleting. In such a scenario, the EMIs must be deferred further,” said Rakesh Batra, who runs a sheet metal manufacturing unit on Khandsa Road.
The situation is worse for those in the garment industry, who are battling problems both at the domestic and global level.
“The stocks that were shipped are lying unsold in European markets and hence the customers are deferring payments. More than 75% of our orders have been cancelled and if we aren’t able to ship the 25% soon, Chinese producers will capture that business as well as they are ready with the shipments,” said Ramandeep Singh, who runs a garment manufacturing unit in Gurgaon.
In order to save the current orders, the sector has asked the government to allow and run the trans-portation of materials without any restrictions while maintaining social distancing norms.
Batra said that there are around 18 lakh workers registered with ESI in Gurgaon. Barring a small number, the majority is employed in the MSME sector. While many of them have already left and might not return in the short run, the employment of those who stayed depends entirely on the future of the MSME sector. “Hence it is imperative that the government steps in right now to save jobs,” he said.
Despite repeated attempts, the state industries department officials could not be contacted.