170 Industry associations join hands to accelerate recovery of MSMEs

As many as 170 industry associations have joined hands to form the All India Council of Association of MSMEs (AICA) in order to deal with issues of the sector hit hard by the COVID-19 pandemic.

The pandemic has affected every industry in the country and MSMEs are hit the most due to frequent lockdowns, AICA said in a statement released by the company.

"From manpower to raw material prices, all have been posing challenges to the existence of micro, small and medium enterprises," it added.

"AICA today announced that 170 industry associations have joined together to address post COVID-19 issues faced by two lakh MSMEs across India," it said.

According to a report by IBEF, India has approximately 6.3 crore MSMEs. The sector contributes about 30 percent to the country's GDP and about 45 percent to the exports.

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"We have been working on combining these associations under one umbrella since the first lockdown was imposed by the Government of India. We will be sharing the draft recommendations with the concerned ministries to look into the points and address the issues," it added.

The core team members include MV Ramesh Babu, President, CODISSIA (Coimbatore District Small Industries Association), Yogesh Pawar, Chairman, Arise and KV Karthik, President, SIEMA (Southern India Engineering Manufacturers' Association).

The coronavirus pandemic, especially, the lockdown has deeply impacted small and medium businesses. Moreover, just when the sector was recovering from the consequences of the first wave, the second wave struck and brought the sector to a standstill yet again.

According to a survey by Care Ratings — which was conducted between April 27 and May 11 with a set of 305 respondents, including small and medium businesses — as many as 84 percent of respondents said the deadly second COVID-19 wave escalated business uncertainty.

The survey also revealed that over 40 percent of the MSMEs were likely to borrow in the coming six months, whereas 41 percent said they didn't want to resort to lending.