To bounce back, India Inc will need more stimulus
Indian industry has become a crucial partner with government, civil society and ordinary citizens in the battle against Covid-19, especially since the last week of April.
Whether it’s diverting the oxygen supply from industry to hospitals, joining the essential medicines logistics and supply chain, or reaching out to global partners for urgent supply shipments, India Inc has made its vital contribution in these times of pandemic.
When it comes to the entire healthcare value chain, apart from the initial supply of essential drugs and medical devices, there are many other critical building blocks that need to be repaired for the delivery of the drug. last mile processing.
The entire pharmaceutical value chain – including raw materials for PPE kits, masks, syringes and packaging material for drugs – ably aided by transport and warehousing logistics, a Helped deliver essential medical supplies to patients through our courageous and diligent physicians, nurses and others. health workers.
Thanks to state lockdowns and our healthcare system, the number of coronavirus cases is steadily declining and the positivity rate is dropping.
This brings us to an important question of our readiness to return to near-normality. Of course, we cannot afford to open everything all at once; unlocking should be gradual.
Behavioral protocols in the workplace, factory premises, public transport and markets must be strictly enforced. Commerce and industry would have a major role to play in ensuring that each employee adopts appropriate behavior in Covid-19, especially in terms of social distancing, wearing of masks and maintaining hygiene.
Now that the workload of the second wave is decreasing, industry and commerce would like to resume or revitalize their activities. India Inc must rigorously engage with government and RBI for stimulus packages designed for different sets of units and commerce.
As the government gets some breathing space to fight the pandemic blaze, Corporate India is reportedly making a strong case for expanded financial support, accompanied by measures to protect jobs and businesses.
There is a broad consensus in industry and among economists that the government and the RBI should further expand their balance sheets and start spending aggressively.
Industry and commerce will have to push for regulatory forbearance by city authorities and tax authorities, and for a restructuring of RBI and bank loans.
Sectors like hospitality and mobility in particular will need government assistance.
In addition, large companies need to hold their suppliers, especially in the SME segment, by offering them working capital support, a firm order backlog, timely release of payments and innovative solutions within the framework of the new standard. Old contracts should be applied with much more flexibility, as parties do not have recourse to justice such as force majeure or law of impossibility.
Business relations between owners of commercial spaces and tenants must be reworked in a pragmatic way. As much as possible, litigation should be avoided in these difficult times. The industrial chambers would play an important role in the dissemination of co-optation ideas with the partners.
To be fair, a lot had started happening on these lines in the first wave of the pandemic. And although the pain was much more intense in the second wave, some experiences are being exploited.
For example, unlike the full lockdown in Wave 1, states resorted to partial shutdowns, allowing large sections of the manufacturing sector to function.
Moreover, from the last two tumultuous months, lessons in terms of resetting some of the work-related protocols, business reengineering, product innovation and technology exploitation must be learned.
In addition, the rural population must be protected by reducing their pain points. It was rural resources that helped the Indian economy to limit its losses in the first wave.
The writer is Secretary General, ASSOCHAM