Daijiworld Media Network - Udupi

Udupi, Aug 29: K B Arasappa, state president of Karnataka Small Scale Industries Association (KASSIA) said that there is a large scope for export oriented industries in Udupi but alleged that the district administration failed to provide the required space. "The district administration is not providing land to establish the venture. This is leading the investors move to other places like Chennai, Andhra Pradesh, Gujarat, to install their exporting companies. We were pressuring the government to build a direct connective road between Bengaluru to Mangaluru for commute. A logistics should be set up at Mangaluru for unloading goods which would help all other industries," Arasappa said.

The KASSIA president was speaking at a press meet organized at Ocean Pearl here on Saturday, August 29. Furthering his claims he said that the move would ease the various issues of production industries in the district. "Udupi has around 15280 micro as well as small, and 86 medium scale industries, generating employment to about 1,17,085 people. Udupi district has units manufacturing varied products numbering to 17. There are four industrial areas established by KIADB and three industrial estates of KSSIDC".

Owing to the current situation and previous lockdown imposed he said that it was unfortunate that about 20 percent of the micro and small enterprises may not be able to revive at all as a result of the shocks.

Even if the lockdown has been lifted the industries would probably take a long time to recover.

KASSIA has been in continuous touch with the government at the centre and the state presenting the ground situation with a view to obtain relief for the industries. "We are satisfied the governments have indeed responded positively to the demands of industry," he said.

Speaking on the inadequacy of the support provided by the government Arasappa said, "The central government has pumped-in liquidity into the system to enable industries to borrow from banks and financial institutions to revive operations under ECLGS with the state government supporting the industries in various ways through moratoriums on payments, waiver of certain payments such as fixed electricity charges and also easing compliance requirements. However, the steps taken are felt inadequate and KASSIA has requested the government to initiate more measures in order to ensure that MSMEs get back on feet".

He alleged that the state government has introduced many schemes but failed in its execution.

As far as the centre is concerned, we have urged them to consider the following issues urgently in the immediate future with a view to reviving the industry, especially the small enterprises:

• Steps to revive demand in the face of complete disruption in consumption and investment in the economy.

• Measures to remove supply chain disruptions that make it difficult for industries to renew the production process and / or reduce inventory.

• Need for extension of moratoriums for the benefit of industry.

• Need to address pain points with regard to GST.

• Ensuring schemes are really implemented at the level of banks without complications or red tape.

• Government must step up investments on infrastructure which will help generate employment and raise demand for SME products and services.

• Central and State Governments must step up expenditure on public works

• In light of our experience of the pandemic, investments in critical health infrastructure and urban housing and slum development will help create considerable employment and demand for products and services.

• The Government must inject cash into micro and small enterprises by means of direct payroll support to such enterprises till the end of the financial year.

• The interest rate on bank loans needs to be reduced to 6 percent for a period for MSMEs

• On the lines of the PF payments being made by the government, the centre may consider payment of ESI contributions of the SMEs so that this takes out the stress on cash outgo from those enterprises.

• Government must also involve the co-operative banking institutions in extending the ECLGS loans to enterprises as it helps the rural industries and also widens the distribution network.

• Exporters who have suffered due to the pandemic need relaxation in terms of NPA norms to enable them to get necessary credit to fulfil commitments.

• The government must consider SMA-2 units to access loans under the ECLGS scheme in view of the continuing pandemic.

• Consider reduction in the rates of GST and also ease compliance norms.

• Consider payment of rent and utility bills of micro and small enterprises through direct cash

• Moratoriums on repayment of loans need to be extended till the financial year end

• Banks must relax repayments further with grace periods

• Not declare accounts NPA under the present norms.

• Ease regulatory compliances and further improve ease of doing business.

He stressed that the government needs to give attention to investing in large Industries, making industrial parks, establishing sea food processing industries, testing laboratories and so on.

Highlighting the importance of testing laboratories he said, "The government needs to set up testing laboratories at Udupi or Manipal for the benefit of local industries as the labs are absolutely essential for ensuring quality of products to meet standards of supply including exports".

KASSIA has embarked on a number of programs for the year keeping in view the need to support MSEs in the wake of the pandemic during the year.

N Jaikumar, joint secretary, I R Fernandez, district president, KASSIA, Prashanth K Baliga, president, rural development small scale association, L R Jagadeesh, general secretary were present.