80% SMBs across India insecure about the future

Hyderabad Consortium of Indian Associations (CIA) has announced that 80 per cent of Small & Midsize Business (SMBs) across India insecure about the future following Covid first and second lockdowns.

Along with 40 partner SMB associations, the CIA carried out a mega SMB survey under which it

had surveyed over 81,000 self-employed and SMBs from across the country. The respondents included manufacturers (49 per cent), service providers (15 per cent), self-employed (14 per cent), and consultants, startups, traders, food and hospitality and others.

The 63 million micro, small enterprises (MSEs) and 40 million self-employed individuals in the country form the backbone of India's economy. The Covid-induced first and second lockdowns over the last 15 months have severely crippled this sector, as revealed in the findings of the report.

The report findings showed that 73 per cent of SMBs have not made any profit during the last financial year; 42 per cent were unable to decide on retention of employees and 59 per cent removed their staff compared to the pre-Covid period (the first wave: 37 per cent; second wave: 22 per cent). As many as 88 per cent of respondents are yet to avail any of the stimulus packages introduced by the Government of India and 82 per cent felt that the central and State governments weren't looking after their interests.

"Over the past year, CIA has provided vital suggestions and modifications required on several initiatives taken by the Centre and State Governments for the benefit of SMBs and MSMEs. As a result, we realised that a data-backed survey would help consolidate the feedback from this sector, to bring out the pain points and provide solutions and a way forward to revive the sector," said K E Raghunathan, Convenor, CIA.

The report espouses that the government needs to adopt a three-pronged approach towards SMBs to exempt, protect and support, to mitigate the challenges currently being faced by the sector.