As people across the Country tries to fight against the 2nd wave of amid pandemic COVID19, in due the time brought the record number of infections and fatalities, a quick survey was conducted by the PHD Chamber of Commerce and Industry.
The survey, which was conducted across 34 sectors, revealed that 73 per cent of the respondents were struggling with the rising cost of raw materials as restrictions in many parts of the country have impacted the pace of economic recovery with an uncertain economic environment, disruptions in supply chains and contraction in demand.
Other key challenges faced by businesses are the availability of working capital (63 per cent), Weakening of demand (62 per cent); Retaining of the full workers (61 per cent ), Costs of the deployed workforce (60 per cent), Payment of wages/salaries to workers /employees (55 per cent0, Repayment of loans/payment of EMIs (53 per cent) and costs of capital (52 per cent ) and costs of compliances (51 per cent).
Although the challenges are multifaceted, the survey found that companies are prioritizing vaccination of employees (73 per cent) as one of the key strategic plans/focus areas to tackle the situation. Businesses are also focusing on increasing sales volume (64 per cent), increasing the scale of business operations (64 per cent), enhancing competitiveness of business operations (64 per cent )cut in costs of business operations (64 per cent), enhancing the price-cost margin (55 per cent ), reducing the workforce in business operations (45 per cent), and enhancing business operations in the international market (36 per cent).
“Coronavirus 2.0 induced restrictions in the country have created a difficult time for the industry. The entire economic activity is severely impacted with the closure of offices and shops, ‘said Sanjay
Agarwal, President, PHD Chamber of Commerce and Industry. The supply chain disruptions are causing skyrocketing commodity prices, which have severely impacted the price-cost margins of the businesses in the difficult pandemic time of coronavirus”.
The survey, which was conducted by the PHD Chamber between April and May 2020, involved businesses across the micro, small, medium, and large enterprises.
Respondents also rated the relief measures taken by the government to migrate the effects of the pandemic. According to the survey,47 per cent of the respondents rated the government’s measures at 7 out of 10, while 42 per cent rated the vaccination drive at 6.
Aggarwal urged the Government to speed up the vaccination process over the next 2-3 months to cover most of the population. In order to do so he said , vaccine production capabilities needed to be enhanced domestically while also inceasing imports from other countries.
“Going ahead , a substantial stimulus to create effective strides for futuristic growth trajectory for Indian Economy and for diminishing the daunting impact of the second wave of the pandemic on economy, trade and industry would be crucial to support the economic momentum in this extremely difficult time ,”said Aggarwal.
India’s economic growth inF.Y 2021 contracted (-)7.3 per cent mainly due to the stringent lockdown in two months of 2020 to contain the spread of the virus. However, this statistical low base effect is expected to provide a good opportunity for India to attain a double-digit growth trajectory in F.Y 2022, said Aggarwal.