Monday, June 01, 2020 , Mumbai: All India Manufacturers Organisation, ( AIMO )an Apex trade body focused on the interests of the MSME sector today announced that the Mass Destruction of Business has begunwith over 35% of MSME’s starting the process of shutting down their operations despite the financial packages announced by the Government of India. This is the first of the six parts of the results of the survey that will announced by AIMO.
AIMO conducted the largest ever MSME survey in association with DIGITALLY 4 EMPOWERMENT( D4E ) a social Tech Enterprise and other trade bodies like Federation of India Industry ( FII ), Association of Indian Industry ( AII ) , Central Manufacturers Welfare Association , ( CMWA) , Consortium of Women Entrepreneurs of India ( CWEI ), Federation of Indian Women Entrepreneurs ( FIWE ) , First World Community among others across the length and breadth of the country.
Commenting on the scale of the survey , Mr K E Raghunathan,Immediate Past President, AIMO said “ We received 46,525 responses for our survey. The most striking aspect was that 35% of MSMEs and 41% of the self employed respondents said that they see no chance of recovery in their business and have begun shutting down their operations. To put this in perspective, India has over 65 million MSME’s employing over 150 million people and over 130 million people are self employed. This kind of Mass Destruction of Business has not been witnessed since our Independence.”
“ Start ups account for over 19% of the MSME’s in the country and is THE future of our country. The financial stimulus provided by the Government is NOT applicable to us in the Start Up sector. We have already issued the termination letters to our employees and have begun the process of winding down. The unfortunate part is that though we believe in our business model and have the best talent, we do not have the financial strength to carry on and also I think it will be difficult for our employees to get jobs in the current scenario. The Gig Economy faces many challenges for the next 6 months. ” Added Anand Prakash, owner of a technology start up from Bangalore
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“ Uncertainity of continuing business is forms a rather undecided category of respondents. Uncertainity seems to affect the smaller and Self Employed category rather than he more established players . 11% OF MSME’s and 17% OF SELF EMPLOYED fell in this category.” Added Raghunathan
“ Our business depends on the business of our clients. We are uncertain on whether they will continue , if so at what scale and how much budgets they will allocate for the specific heads like out sourced design. We have been informed that they will revert only post October. This is a period of uncertainity for us in the design industry on whether to search for a job or continue as a freelance designer.” Added Ruhi Jain, a free lance designer
“ The Corporate respondents indicated that while business was affected it 51% felt may take 3 months to recover while 26% felt they will bounce back by the end of the year. This sector will NOT see many closures but will see many people losing jobs , scale down of operations , focus on core business and a fine financial balancing act.” Added Mr Raghunathan
6% of the Corporate and 11% of the self employed respondents were buoyant and were unaffected by the COVID19 situation as well. These respondents were primarily employed or involved in the essential sector.
“ AIMO showcases the heartbeat of MSME’s in India. While we appreciate and thank the FM and PM for bringing the needs of MSME’s in the limelight, on speaking to our members of various MSME associations and Industrialists across india, they are unanimous in their opinion that the benefits of financial packages announced by the FMhas still not reached the doorsteps of the MSME’s.” concluded Raghunathan