COVID-19 and lockdown have done irreparable damage to micro, small and medium enterprises (MSMEs) in the State, president of Karnataka Small Scale Industries Association K.B. Arasappa has said.
Addressing a press conference here on Wednesday, Mr. Arasappa said that the association had estimated that 20 % MSMEs might not restart due to disruptions caused by the pandemic. “These enterprises were already facing an economic slowdown when the pandemic gave a severe blow. The supply chains have been broken and orders have been cancelled. Financial sources dried up posing a serious threat to their very existence,” he said.
Both the Union and State governments have extended financial assistance for the MSME sector. However, many problems remain unanswered. “The main problem is a lack of demand. The sector needs an economic stimulus on a substantive scale to kick-start the economy,” he said.
The association has demanded that the Centre take steps to revive demand, to restore supply chain and extend moratorium, besides addressing issues regarding GST.
Mr. Arasappa also urged both the governments to step up investments on infrastructure and public works which will help generate employment and raise the demand for products of the MSME sector.
Hassan district has over 17,500 MSME units with an investment of ₹ 800 crore employing 97,000 people, he said.
Office-bearers of the association were present.
