MSMEs operate at 50 per cent capacity

Migrant labour start coming back but industries say the situation will not match pre-covid times

By   |  Published: 28th Sep 2020  12:02 amUpdated: 27th Sep 2020  11:40 pm

Hyderabad: Even as unlocking is happening in phases, the micro, small and medium enterprises in the industrial areas are still operating at about 50 per cent of their capacities. In addition, the companies are also seeing a shortage of manpower as many of the labour who left due to cover are yet to come back.

The companies are now managing with about 50 per cent staff. However, the bigger problem is the lack of orders for them. “The sentiment is improving but it will take some time for the production to come back to pre-covid levels.

The companies have exhausted their cash reserves and are now looking up to the government for further measures,” said K Sudhir Reddy, President, Telangana Industrialists Federation.

According to him, the measures so far announced were limited to extending loans. “Availability of loans is one aspect. But they should be available at a lower cost. The rate of interest should be reduced. It currently averages 12-13 per cent and this needs to come down,” he said.

While the Government is keen on attracting companies that are exiting China to India, the high interest rates are a challenge for the industries willing to look at India, he said adding that the domestic companies too are seeking steps to lower the cost of doing business.

Many companies are not able to operate in two shifts due to the sagging demand. The companies are maintaining an inventory corresponding to the demand.

On a query on labour related issues, Reddy said most of the companies depended on labour from other states. While some of them have returned, there is no estimate on the actual number of people that were working here or have left the city due to the pandemic, he said adding that there could be a total workforce of about ten lakh in about 50,000 units in twin cities. The migrant labour could be about 40 per cent of that, he said.

K Koteswara Rao, Convener, All India Forum for Small and Medium Enterprises, said there are many industrial areas in and around Hyderabad and adjoining areas. The total workforce could be about 40 lakh and about 60-70 per cent of them have migrated here.

“We are seeing labour living near the State borders come back. We believe that a large number of people will not come back anytime soon. The companies are also coming to grips with this situation. There will be no new employment opportunities for some more time,” he said.

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