GDP contraction poses threat to MSMEs, govt support of little help: Report

The contraction may also lead to a 15% fall in corporate India's revenues

A 5 per cent contraction in the gross domestic product (GDP) during 2020-21 may lead to a 15 per cent fall in corporate India's revenues and poses an "existential threat" for small businesses, a report said on Monday.

However, policy interventions by the Reserve Bank of India (RBI) and the finance ministry offer little hope because they cannot revive demand, which is crucial for small businesses, the report said.

The micro, small and medium enterprise (MSME) sector will have to face a sharper decline in revenues of up to 21 per cent, while operating profit margins will narrow to 4-5