The Modi government should really provide short-term fiscal assistance towards payments of salary for workers in the MSME sector and/or exempt employers’ contribution to provident fund and Employees’ State Insurance for the existing fiscal year, market body FICCI’s most current round of Business Confidence Survey stated on Monday. Responses from about 180 firms with a turnover ranging from Rs 1 crore to Rs 60,000 crore across sectors in the survey also asked the government for making certain timely refunds of unadjusted taxes and levies to lessen the influence on working capital constraints on tiny companies amid Covid. Respondents also asked for the adoption of finish-to-finish paperless transactions to speed up refunds on an operational level.
Even as companies acknowledged the policy assistance extended by the Reserve Bank of India on May 5, 2021, which includes monetary assistance to MSMEs, several troubles on the working of the monetary technique have been stressed for urgent interest. A considerable chunk of respondents stated that they have been unable to avail credit from banks as they have develop into excessively danger-averse. “The entire process for approval of loans has become extremely time consuming which severely dampens business prospects,” the survey noted. The survey participants also urged banks to boost lending at a affordable price to the market. “It is essential that credit is provided to distressed segments of the industry, as well as to those segments which have adequate collateral or have great potential to generate more cash flows as the economy moves towards normalization,” respondents stated.
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Businesses also sought continuation of liquidity assistance and credit enhancement measures to MSMEs from last year. Moreover, they asked for targeted fiscal assistance in the kind of tax waiver and monetary help to sectors that have been previously kept out of the stimulus package but have been deeply impacted by it which includes travel, tourism, hotels & hospitality, and civil aviation.
Overall, the enterprise self-assurance index in the existing round of the survey had declined to 51.5 soon after reporting a decadal higher worth of 74.2 in the preceding round. “Worsening in current conditions as well as muted expectations about the near-term prospects on the back of a sweeping second wave of coronavirus infections pulled down the overall index value,” the survey stated. The quantum of respondents citing weak demand as a constraining aspect jumped to 70 per cent from 56 per cent respondents in the preceding round.