India Inc hails extension of COVID-19 lockdown, calls for measures to protect economy

Industry bodies on Tuesday welcomed Prime Minister Narendra Modi's announcement of extending the COVID-19 lockdown till May 3 but called for an urgent economic relief package to protect jobs and small businesses.

"FICCI is encouraged by the decision that while our priority will continue to be on saving lives, we will continue to take measures to preserve the livelihoods and bring the economy back on track," said its President Sangita Reddy.

Estimates show that India may be losing close to Rs 40,000 crore daily due to the national lockdown with an estimated loss amounting to Rs 7 lakh crore to 8 lakh crore during the past 21 days. It is also expected that close to four crore jobs are at risk during the April to September period, she said.

"Hence an urgent relief package is also critical. The Prime Minister's directions on graded opening will help start some production activity to ensure that as soon as lockdown opens, there are no shortages faced. Even in case of essentials, we are seeing that supplies have started to get impacted and so easing of lockdown may help ramp up production."

Reddy said the Indian industry looks forward to detailed guidelines on working of units in essential goods and services to be issued tomorrow by the government.

CII Director General Chandrajit Banerjee said the Prime Minister has provided guidance on exit from the lockdown after April 20 which will help the industry plan better.

"The extension gives the government adequate preparation time to organise an orderly and safe restart of the economy as and when health conditions permit. The industry too can devise its strategies for commencing operations accordingly during this extension period," he said in a statement.

FIEO President Sharad Kumar Saraf too welcomed the lockdown extension but said the deferment of the selective opening of the industry is disappointing.

Non-adherence to the delivery schedule for exports will result in cancellation, penalties and market loss besides the business loss to enterprises, he said. The exporters, particularly MSME exporters, have no liquidity to pay wages for the month of April as they are unable to conduct any business activity during the lockdown.

"Shifting of the goalpost will not help in avoiding stark realities which we have to face whenever we open. The start of selective manufacturing will also be a long-drawn battle due to the unavailability of labour, raw material and transport which will resume normalcy only after a few months of selective opening," said Saraf.

He called for a comprehensive economic package to help the economy with interest-free credit to cover six months of wages, rent and utilities along with a moratorium to repay in instalments after six months.

Without such support, said Saraf, the government should not expect the industry to pay wages during the lockdown and any coercive action to bring about the same will only be counterproductive.