COVID-19 Impact | Almost 60% startups and MSMEs on verge of closure, sell off, says survey

As much as 59 percent of startups and MSMEs are likely to downsize, shut shop or sell business in this year

Moneycontrol News
May 27, 2021 / 03:21 PM IST

The ferocious second COVID-19 wave and extended regional lockdowns impacted sales which has affected working capital of most companies, already scrambling against the pandemic’s effects since 2020. (Image: Shutterstock)

Almost 60 percent of existing startups and small companies may shut down or sell their business amid the second COVID-19 wave, a survey of more than 6,000 startups and medium, small and micro enterprises (MSMEs) in 171 Indian districts by LocalCircles showed.

As much as 59 percent of startups and MSMEs are likely to downsize, shut shop or sell business in this year, The Economic Times reported.

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Of the companies surveyed, 49 percent plan to reduce employee compensation and benefits by July, 41 percent have less than a month’s worth of funds, and a mere 22 percent have runway for more than three months, it said.

The ferocious second COVID-19 wave and extended regional lockdowns impacted sales which has affected working capital of most companies, already scrambling against the pandemic’s effects since 2020.

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COVID-19 Vaccine

Frequently Asked Questions

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How does a vaccine work?

A vaccine works by mimicking a natural infection. A vaccine not only induces immune response to protect people from any future COVID-19 infection, but also helps quickly build herd immunity to put an end to the pandemic. Herd immunity occurs when a sufficient percentage of a population becomes immune to a disease, making the spread of disease from person to person unlikely. The good news is that SARS-CoV-2 virus has been fairly stable, which increases the viability of a vaccine.

How many types of vaccines are there?

There are broadly four types of vaccine — one, a vaccine based on the whole virus (this could be either inactivated, or an attenuated [weakened] virus vaccine); two, a non-replicating viral vector vaccine that uses a benign virus as vector that carries the antigen of SARS-CoV; three, nucleic-acid vaccines that have genetic material like DNA and RNA of antigens like spike protein given to a person, helping human cells decode genetic material and produce the vaccine; and four, protein subunit vaccine wherein the recombinant proteins of SARS-COV-2 along with an adjuvant (booster) is given as a vaccine.

What does it take to develop a vaccine of this kind?

Vaccine development is a long, complex process. Unlike drugs that are given to people with a diseased, vaccines are given to healthy people and also vulnerable sections such as children, pregnant women and the elderly. So rigorous tests are compulsory. History says that the fastest time it took to develop a vaccine is five years, but it usually takes double or sometimes triple that time.

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India’s economy had just started showing signs of recovery from the first lockdown (implemented countrywide March-September 2020 and new local restrictions since April 2021.

.A solution expected by startups is government support to deploy corporate social responsibility (CSR) funds into startups that have social impact, such as those engaged in health equipmentr support, community engagement and emergency assistance.

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Moneycontrol News
TAGS: #coronavirus #Economy #India #MSMEs #startups
first published: May 27, 2021 03:21 pm