As India Inc limps back to normalcy after a two-month lockdown, top industrialists and executives are voicing apprehension over what they describe as inconsistent regulations and lack of collaboration among various levels of government, municipalities as well as state and central governments.
Further, a shortage of workers owing to the exodus of migrant labourers — who have returned home in the wake of the lockdown imposed on March 24 — has impacted production significantly, said several industry chieftains.
“As we begin opening up, it is important for the Centre, state and local authorities to speak in one voice and collaborate with each other to help India Inc get back on its feet. The inconsistency in regulations and implementation will hurt businesses, especially the small and medium enterprises that provide employment to so many workers,” said Thermax chairperson Meher Pudumjee.
She also advised caution as more activities are permitted. “We have to open up, there is no other choice. But we have to do that carefully, keeping in mind the possibility of a second wave.”
TVS Motor Company chairman Venu Srinivasan said the crisis caused by exodus of migrants was not handled well. “Lack of coordination, changing policies and the unfortunate, inconsistent manner in which the issue was handled have led to paralysis. Now, it’s more of a blame game between the Centre and states,” he said.
‘No Centre-State Collaboration in Managing Exit’
Top officials said there appears to be no collaboration between the Centre and state governments in managing the exit from the lockdown. “The cost of resuming operations of heavy-machinery plants and big offices are high, and a flip-flop on regulations every few days has thrown plans out of gear. This is too expensive a proposition. This is not the time for politics,” said a leading industrialist. He was referring to the possibility that a plant, which had just reopened, could again be shut down if a worker tests positive for Covid-19. “The government gave in to hysterical panic and seemed to have a short-term mindset with regard to policies and regulations,” said the chairman of a leading business conglomerate, seeking anonymity.
Nawshir Mirza, who serves as an independent director on the boards of several companies, summed up the frustration: “The cost of restarting operations is huge, and it is better to sit and bear losses than tackle inconsistent policies and rules that change every third day.” And the gas leak at the LG Chemicals plant in Vizag that killed 12 people is fresh in memory. “Restarting operations is not like going back home and switching on the electrical mains. It is a detailed and expensive proposition to restart heavy machinery that has been lying unused. See what happened in Vizag,” said a top executive.
Officials said the government needs to work along with industry in a confidence-building exercise to enable the return of migrant labourers in the next few months. Without that, increasing output beyond 50-60% in the manufacturing sector will be next to impossible, they said. Parle Products director Arup Chauhan said nothing noticeable was achieved during the extended lockdown in terms of slowing the spread of the virus. “The price we are paying is humongous. Halting the economy for really long has resulted in cascading problems, culminating in countless job losses.
How does India Inc start up with all the migrant labourers returning home? Their suffering is a saga in itself. It was badly handled by the Centre and states alike. No concrete plan is being spelt out for exiting the lockdown,” he said.
ISSUE OF MIGRANTS
Toyota Kirloskar Motor vice chairman Vikram Kirloskar said the issue of migrants should be handled sensitively. “Companies may have to consider opening factories in rural areas or smaller towns, so that the skilled migrant labour can be employed there. More cash needs to be given in the hands of migrant labourers,” he said.
Ficci president Sangita Reddy said the combination of fiscal, liquidity and other structural reforms recently announced by the government are not enough to create demand. But these measures could be significant if effectively executed, she said. “The reality on ground shows considerable pain and needs additional steps. The speedy response to lockdown was appropriate, but there has been an inability to cordon off areas and do elaborate testing.”
CLOSURE OF STATE BORDERS
Abrupt closure of state borders creates confusion and hampers travel by workers as well as the logistics of running factories and offices, executives pointed out. On Monday, Delhi chief minister Arvind Kejriwal announced that he was sealing the Capital’s borders for a week. For much of the lockdown period, Delhi’s neighbours Uttar Pradesh and Haryana have imposed restrictions on the movement of people from the national capital. Karnataka, meanwhile, has insisted on quarantining of people entering the state — whether by bus, train or aircraft.
The Centre, states and local administrations need to work in tandem, said India Inc. “This is the time to keep aside political differences and move together to revive the economy, and put money and food in the hands of people. The ‘one ration card, one country’ policy will provide much relief,” said Pudumjee of Thermax.
She also sought compassionate corporate policies to deal with migrant workers. “As corporates, migrant workers were an invisible species to us. Covid-19 brought them into focus. So, corporates need to treat them as human beings, care for them and incentivise them. Many are still stuck in cities and want to return home. We can offer better pay and send them in batches, so that work does not suffer. India Inc has to offer a minimum wage guarantee,” she said.
NewsSource: Economic Times