The humankind is currently witnessing the disastrous effect of COVID-19 on the socio-economic balance of the world. It has toppled economic growth and has risked the lives of millions. The tradeoff between the health of masses and industrial activities has been detrimental to the economy. While no respite seems plausible in the coming months, economists, industrialists are dealing with the challenging task of demand creation, above all, economic revival.
About two-thirds of the respondents expect revenues to fall more than 40 per cent in the April-June 2020 quarter, while for FY21, the expectations of a fall in revenue are staggered, with 33 per cent of the firms anticipating a revenue fall of more than 40 per cent, closely followed by 32 per cent of firms expecting a revenue contraction ranging between 20 per cent to 40 per cent.
The poll also tried to identify key constraints faced by the businesses. Nearly 75 per cent of the respondents identified the complete shutdown of the operations as the major constraint, followed by 53.1 per cent for lack of demand for products.
45 per cent of the respondents felt that it would take more than a year to bring back the economy on track, while 34 per cent expected their own company to recover in 6-12 months timeframe.
Boosting demand in current circumstances is a major challenge before the country. Nearly 37 per cent of the respondents believe the domestic demand to hit normalcy in 6-12 months, while the same confidence for export orders is sluggish, with 41 per cent expecting it to take more than a year to recover.
Securing livelihoods is the prime concern for the country. More than half of the CEOs anticipate job losses in their respective sectors, post lockdown, with nearly 45 per cent expecting 15-30 per cent job cuts.
In a sign of relief for employees, two-thirds of the respondents have not experienced a salary/wage cut in their firms, while nearly 49 per cent of the firms who have witnessed a wage cut said the period of wage cut is ‘undecided.’
There is a need to do a qualitative and quantitative impact analysis of the mitigation efforts to assess the viable economic scenario. CII has suggested a regular review of hotspots to barricade the containment zone and carry-on with the operations in the rest of the area. Bringing back the migrant workers to the manufacturing hubs is also key to reviving industrial processes, which must be coupled with demand creation. CII has been working with the government to bring back the economy on-track and protect the sustenance of millions.
Click here for the CII CEO Snap Poll
When the second phase of the lockdown ends on 3rd May, it will have been 40 days since the lockdown was announced. The economic cost continues to mount, although the lockdown has helped flatten the COVID-19 curve.
Within services, the majority of trade, transportation and hospitality remains closed, while financial, IT and government services remain partially operational. Even in the power sector, which is permitted to operate, significant reduction in demand owing to lockdown is having an adverse impact.
The chance of a significant revival in investment activity is unlikely since capacity utilization levels may remain suboptimal. Consumption demand is also not likely to pick up noticeably since people’s incomes have been impacted.
On the external front, as economies across the globe continue to struggle with the pandemic, global trade may decline by 13 to 32 per cent in 2020, as estimated by the World Trade Organisation.
This will lead to disruption in supply chains, slow pick-up in investment activity, labour shortages in the short-run and muted consumption demand on account of reduced household incomes.
In the optimistic scenario, which envisages a faster pick-up post the lockdown period, GDP is forecasted to register a growth of 1.5 per cent in the best case.
Source: CII Research estimates
CII has also suggested additional working capital limits to be provided by banks, equivalent to April-June wage bill of the borrowers, backed by a Government guarantee, at 4-5% interest.
In addition, the CII paper has suggested the creation of a fund or SPV with a corpus of Rs 1.5 lakh crore which will subscribe to NCDs/Bonds of corporates rated A and above. The fund can be seeded by the Government contributing a corpus of Rs 10,000-20,000 crore, with further investments from banks and financial institutions such as LIC, PFC, EPF, NIIF, IIFCL et al. This will limit Government exposure while providing adequate liquidity to industry.
With these measures in place, it is hoped that decline in the GDP growth rate would be contained.
Click here to read the CII Report on – A Plan for Economic Recovery
The guidelines issued by the Government on relaxation of lockdown after 20th April within the parameters of safety precautions have brought relief to industry as well as workers and farmers. CII has suggested continued stringent lockdown in specified containment zones with rest of the identified hotspot districts to be open to economic activities with adequate safety measures.
CII has submitted detailed recommendations to the Government based on inputs received from industry members across the country. It has called for action on 5 key areas in advance of the implementation of the guidelines on 20 April. CII hopes that states would issue guidelines in accordance with those recommended by Ministry of Home Affairs and not take stricter measures.
One, red zone districts and containment zones need to be clearly identified and demarcated and industrial activities should be permitted in non-containment zones of red zone districts, if found safe. A list of red districts and containment zones may be published on a real-time basis for information of industry.
CII members have also pointed out that the Government needs to clarify that industrial operations permitted during the lockdown for essential items would continue to be permitted and that no further separate notifications from central/state government are required for their operations after 20 April.
Two, certain activities related to the sectors that have been opened up would also need to be permitted to ensure that operations continue smoothly. For example, automotive value chain including OEMs, components, retail and service workshops must also be included in the list of permitted industries. Agricultural inputs of fertilizers, pesticides and seeds have been opened up, and there is need to also relax rules for production of necessary equipment.
Similarly, equipment and services for generation, transmission and distribution of power, including renewable energy such as gear boxes and generators may be allowed to function.
Three, shifts, transportation and stay of workers, social distancing and strength of workforce needs greater clarity and redefinition in some cases. Two shifts may be permitted for industries allowed to function, especially for essential items. In continuous operation plants, it is not possible to have a 1-hour gap between shifts and instead workers may start work on a staggered basis.
Stay of workers in large factories within the premises may not be possible to arrange at short notice and nearby facilities should be allowed to be used. Further, personal vehicles of employees in all industries opened up may be permitted to ply during the lockdown.
The guidelines have suggested 50% of workforce to operate to begin with in plantations and IT and IT enabled Services. This could be done on a self-certification basis. Moreover, in certain cases, if adequate social distancing norms are maintained, then more than 50% strength could be permitted.
Four, model guidelines should be notified for industrial areas, MSMEs, rural areas, etc. The list of industries and industrial establishments allowed to operate needs clarification in certain cases. For example, units manufacturing for exports but not in SEZ or Export Oriented Units category should be allowed to operate.
Finally, larger manufacturing plants should not be subject to complete closure on detection of a Covid-19 positive case in one part of the plant. A detailed protocol should be followed in case of such eventuality to identify and isolate contact persons.
The lockdown in India starting March 25 brought almost all economic activity in India to a halt. A step necessary to save lives, it, however, put a question mark before the livelihoods for millions of Indians, especially those at the bottom of the pyramid such as migrant labour.
As the economic crisis grew, the need to re-start the economy to save millions of lives in the long-term was acutely felt in many quarters, and CII submitted recommendations to restart the economy in a safe and calibrated way, taking into consideration the geographic spread of COVID-19.
Taking cognizance of the situation, on 14 April, Prime Minister Narendra Modi announced an extension to the lockdown till 3 May 2020 but with a caveat: post 20 April, partial opening of the economy was permitted.
The Ministry of Home Affairs subsequently released detailed guidelines stating the select activities permitted, subject to their not being in designated ‘containment’ zones within hotspots; any new area in the containment zone would warrant suspension of activities previously permitted in that zone, and a withdrawal of permission in case of violation of lockdown measures, risking the spread of COVID-19.
This move was welcomed by industry and seen as a pragmatic step in the right direction as it struck a fine balance between safety and economic sustenance.
The guidelines, to be operationalised by State Governments keeping in view ground realities, permitted opening of sectors and activities, with details specified under each, such as health services, agriculture and related activities, financial sector, social sector, online teaching, MNERGA works, public utilities, movement including loading/unloading of cargo and goods, supply of essential goods, and commercial and private establishments.
The guidelines have a separate section devoted to hotspots and containment zones, where strict monitoring would be done to ensure there is no spread of COVID-19. Standard operating procedure for social distancing for offices, workplace, factories and establishments are also specified in the guidelines.
In such a dynamic situation, regular detailed monitoring will be essential to ensure that the restarting of the economy does not, in any way, push back the gains due to the lockdown. CII and industry are working in close partnership with the Government to ensure that due care is taken of both lives and livelihood, given the enormous and far-reaching impact of Coronavirus.
While being focussed on the economy, CII has been equally focussed on relief and rehabilitation measures. It has reached out to lakhs of people in 27 states, providing hygiene material, food and other support to minimise the losses and suffering. As the economy re-starts, one critically important aspect would be to get migrant labour back to the manufacturing hubs. Also, a fiscal stimulus and industry support at this time would be critically important to ensure that the partial lifting of the lockdown begins to yield positive economic returns.
CII has recently prepared a white paper on the exit strategy and suggested various measures to ensure that it is well planned, and executed to ensure that the country, gradually but sure-footedly, moves back on track with respect to economic growth.
As the lockdown in India has been extended till 3 May 2020 to prevent the spread of Coronavirus, the need for relief and rehabilitation has increased as millions find themselves stranded and unable to earn their daily living. Specially affected are migrant labour, dependents, and people from weak socio-economic backgrounds.
CII has undertaken various initiatives over the years related to disaster relief and management. As millions of Indians get impacted due to Coronavirus, CII, along with the CII Foundation, Young Indians (Yi) and associate associations SIAM and ACMA is undertaking extensive relief and rehabilitation operations.
As on April 13, 2020, CII is working across 27 states in India such as Jammu and Kashmir in the north, Gujarat in the west, Nagaland in the east and Tamil Nadu in the south, covering a wide expanse of the country. Targeting vulnerable sections of society, CII has so far reached out to more than 2.5 million beneficiaries.
Key initiatives taken include:
1. Distribution of hygiene material
33 lakh hygiene materials including 5 lakh masks, 6 lakh gloves, 8 thousand PPEs and 21.75 lakh sanitizers/soaps have been distributed among the vulnerable population, policemen and medical workers.
2. Provision of food
9 lakh cooked meals, and 4.25 lakh ration kits and 500MT of food grains have been provided to the needy such as daily wage labourers, migrant workers, farmers, the elderly, nomadic tribes, children and women workers.
3. Community Kitchens
CII has supported numerous community kitchens in cities such as Delhi, Bhopal, Rajkot, Bhilai, Jamshedpur, Dhanbad, Patna, Cuttack, Kalinganagar, Ernakulam, Jaipur, Hyderabad, Noida, Guwahati, Asansol, Jamshedpur, Durg, Udaipur, Dehradun, Lucknow, Bareilly, Hubballi and Vizag.
4. Installation of Disinfection Tunnels
In places such as markets and bus stands, where typically large numbers of people gather, disinfection tunnels have been installed by CII and Young Indians (Yi) to minimise the chances of spread of the virus.
5. Awareness Drives
The CII Foundation has undertaken awareness drives and relief work in 115 villages in 6 districts in Punjab and Haryana, while the CII Foundation Woman Exemplar Network has created awareness and distributed ration kits to marginalised communities in UP, Rajasthan, West Bengal and Maharashtra.
6. Special Helpline for the disabled, single and widowed women
The CII Indian Women Network has launched a special helpline in Puducherry and helped over 200 individuals with their problems so far.
In addition to the above ongoing activities, CII is working in close collaboration with State Governments, government offices, hospitals and police departments to undertake health and welfare interventions, in states such as Delhi, West Bengal, Punjab, Telangana, Tamil Nadu, Himachal Pradesh, Karnataka, Chhattisgarh, Maharashtra, Gujarat, and states of North East India.
For more details on CII Covid-19 relief and rehabilitation, and to contribute to the CII Covid Relief Fund, visit https://www.ciicovid19update.in/.
A time of crisis is a time for everyone to rally together to emerge from the crisis. Corporate India is stepping up to the task, and as India’s leading industry body, CII is spearheading relief and rehabilitation measures to mitigate suffering and losses across the country.
A calibrated and safe exit from the lockdown, subject, of course, to considerations being given to the geographical spread of COVID in the country, would be a practical approach. This is an evolving situation and therefore, we should be open to alter our approach as we go along.
Given that the number of cases has rapidly increased and hotspots have emerged in the country over the last few days, and that the opening up across the country would need to be slow and staggered, it would be desirable to have three classifications of geographies as red, amber and green, based on the incidence of COVID cases. The principle should be that we look at opening up in concentric circles around the red zones. The radiating heat map should turn from red in the inside to green on the outside. In other words, “Lock inside out” should be the model.
A more complex point is whether all industries can open in the green zones and which ones should open in the amber zone, assuming that none would be operational in the red zones other than essential and exempt services.
The point to stress is that all facilities that reopen must have requisite health, sanitation and screening systems in place to protect workers. Various measures have been suggested such as thermal check, social distancing, factory sanitisation and so on. Any enterprise which does not comply with this on a self-certification basis should be subject to stringent penalties.
However, prior to the lifting of the lockdown, there has to be adequate notice given to all and along with that there should be announcement of an economic package.
Prioritisation of industrial sectors is essential for restart to gain from the control measures employed to reduce the spread of the pandemic while minimising the economic impact of the lockdown affecting exports, livelihoods and jobs.
To plan the restart of industry operations post COVID-19, CII has looked into the Health, Social and Economic impact of lockdown to arrive at the prioritisation of the industry sectors. CII has used four key indicators for prioritisation of sectors for restart. These include sectors that are part of and support the essential goods and services ecosystem, labour intensive sectors that support jobs and livelihoods, sectors that are essential for protecting India’s export market share and gain the confidence of global markets besides sectors that will help us manage our imports to a minimum based on essential requirements for further production and export.
Textiles and apparels, 100% operationalising pharmaceuticals sector, food processing, minerals and metal besides, ecommerce, automobiles and chemicals are the key sectors that have been suggested for restart among the industrial sectors that need to restart operations in a calibrated manner.
The CII report, Exit from the Lockdown, has suggested a stagewise and zone wise restart of industrial operations to, meet all essential needs of the economy, ensure protection of livelihoods and jobs, protect export market shares and meet export obligations besides helping manage the import dependence of the economy.
Stage I opening of sector, according to the CII report, include 100% Pharmaceuticals manufacturing, Textiles and Apparels, Food Processing and Minerals & metals. Stage II would entail opening with a gap of one or two weeks after the first stage sectors start their operations and includes Agri Market operations, Ecommerce including food and groceries delivery, Automobiles, Chemicals especially those used for sanitation and other healthcare purposes and those that support pharmaceuticals and other essential sectors. Stage III could be the remaining sectors after one or two weeks after the second stage sectors start operations.
Sectors that fall into green and amber zones are based on the levels of labour intensity of the sectors. Green zone sectors are those which are less labour intensive while sectors that fall into amber zone are labour intensive. These sectors are recommended to be opened in a calibrated manner while maintaining strong health, sanitation and social distancing protocols, the CII report said. The CII report outlines detailed sector wise protocols for maintaining health and sanitation and social distancing besides guidelines for maintaining the shop floors and other areas used by workers and employees in factories, warehouses, market yards and offices.
13/4/2020 0 Comments
- Chandrajit Banerjee
The global spread of Covid-19 has brought about an unprecedented halt to activity in all major economies. WTO has forecast global trade volumes to drop sharply by 13-32%, which has not been seen before in the modern era. The situation is so fluid that most of us hesitate to put a number to growth projections for 2020-21.
Companies dependent on foreign trade are especially vulnerable in these times. India’s biggest export markets – the EU and US – have extended lockdowns in place. Already, between April 2019-February 2020 for the period before the lockdown, India’s merchandise exports declined by 1.5% over the same period last year while imports declined by 7.3% to $436.03 billion.
As the world battles Covid-19, we must take care to sustain our export markets and ensure that lockdown does not translate into loss of outward bound goods. As a first step, the government has provided a welcome extension of the foreign trade policy incentives which were to expire on April 1.
As an immediate measure to protect exports, CII has suggested that exports be classified under essential services so that they can operate with free movement of cargo across states. Delays in filing of bills of entry and payment of customs duties should be given a one-time relaxation of three to six months.
A key issue facing exporters is credit access. The extension of the interest subvention scheme available for MSME exporters could be announced immediately. Further, to tide over the current crisis situation, the scheme could be extended to all exporters as well as those manufacturing mainly for exports. For imports related to exports, banks need to prioritise credit documents and provide special cash credit funding.
Most nations are proactively supporting their exporters during these difficult times. For example, China increased export refund facility by 2% recently. Such moves make Indian goods less competitive in global markets and must be compensated through an additional duty drawback of at least 3% for the next six months to avert mass closure of enterprises.
Another challenge for exporters due to the current lockdown measures is delays in clearances of import containers which attract increase in demurrage and container freight station charges. Such charges should be waived to avoid cost escalation, along with relaxation in time for submission of documents. Some facilities, such as exports inspection council which provides certificates of origin, need to continue operations to avoid delays in exports.
Certain ports and airports should be specifically identified for handling exports on priority basis. To ensure that goods reach these exit points, self-certification should be considered as valid for inter-state movement.
Clearly, the current geographic configuration and concentration of global value chains will dramatically reorient due to the pandemic. The sourcing and import disruptions that have occurred as a result of Covid-19 mean that countries will be seeking to diversify their markets and sources of imports. This will also need to be taken up multilaterally.
India stands a good chance to be able to leverage the evolving trend if it makes strong efforts to expand its export basket and reduce domestic logistics and procedural costs. To diversify exports, agricultural products present a good opportunity. The agriculture ministry has identified 21 products which could be prioritised.
Targeting a few countries per product and meeting their specific standards and sanitary and phytosanitary import requirements also needs attention – this can be done through a government industry standards taskforce. Given air travel disruptions, the government could consider instituting special flights with appropriate sanitary and disinfectant provisions to enable exports from the horticulture, floriculture and processed food sectors.
Two, meat, poultry and fisheries sector could see enhanced exports as well. Trade facilitation by simplifying farm registration procedures for greater traceability and making antibiotic testing easier is required. Easy access to cold storage and warehousing facilities in marine or other food parks at concessionary rates would also be helpful, as would greater avenues to enable processing and value addition.
Three, India has been called the ‘world’s pharmacy’ because of the dominance and quality of its generic medicines. Its supply of drugs to fight Covid-19 to the US and Brazil was a welcome move as it strengthened the India brand as a reliable source of pharma products.
The government has announced an incentive programme of Rs 10,000 crore for spurring domestic API production and in the short term, imports of API could also be considered for ramping up manufacturing for domestic use and exports. Alternative sources of APIs such as Japan, Canada, the Netherlands should especially be explored. Indian pharmaceutical and biotech firms could also look at collaboration with global peers seeking to roll out the new Covid-19 vaccine and treatment medications. For both clinical trials and quality manufacturing, India could position itself as the ideal partner.
Over the medium term, global trade governance will emerge as a critical area for the world to work on in order to minimise disruptions and coordinate actions. This can only be done collectively and strengthening the WTO would be the best mechanism to achieve this.
Indian industry remains fully committed to working with the government to navigate these uncertain times and begin the process of realising India’s full potential in trade.
Note: This article was first published in The Times of India on April 13, 2020
The Novel Coronavirus (or COVID-19) pandemic is causing a significant impact on individual lives, businesses, and the economy. The Indian economy was already witnessing a slowdown in the last few quarters and the current pandemic is going to make the recovery even more difficult.
To curb the spread of the pandemic, the Government announced a 21-day national lockdown starting from March 25, 2020. This was a necessary step as it encourages social distancing, which is the only way to break the cycle of infection. Though the supply and distribution of essential products & services are exempted from the lockdown, it is the most vulnerable sections of the society that are bearing the brunt of this.
The Confederation of Indian Industry (CII) invited close to 200 CEOs from different sectors to participate in an electronic survey titled ‘CEOs Snap Poll on Impact of COVID-19 Lockdown on Industry’. The unanimous survey outcome was the pandemic followed by the subsequent lockdown, has significantly impacted the domestic economy and a further decline in the topline & bottom-line for the current & previous quarters is to be expected.
Close to 75 percent of the respondents expect revenues to fall more than 10 percent in Q4, FY20. As far as bottom-line is concerned, close to 67 percent of the respondents expect the bottom-line (or net profit) to decline more than 5 percent. The expectations of the sharp decline in revenue and net profit are indicators of the impact that this outbreak has on the domestic companies and overall GDP growth.
Along with a decline in an economy, comes subsequent loss of employment. In wake of the COVID-19 pandemic, approximately 52 percent of the firms foresee job losses in their respective sectors post lockdown. According to a CII survey, around 46 percent of the respondents believe that the pandemic will have no major impact on the job market and therefore no expectations of job loss. Majority of the firms expect less than 15 percent job loss whereas 32 percent expect job losses to be in the 15~30 percent range. The repercussions on the job market will only be evident once the lockdown ends.
The complete lockdown has brought most businesses to a standstill, wherein their inventory is not going out in the market. More than 80 percent of the firms from the CII survey claimed that their inventory was currently lying idle and 64 percent opine that the inventory will be cleared in less than 30 days. Close to 36 percent of the respondents expect a demand slowdown in the post lockdown period.
Though the Central Government has allowed transportation and distribution of essential services during the lockdown, many issues had to be fixed to ensure smooth inter-state transportation. Most of the firms engaged in the production of essential products and supply of ancillary goods faced issues such as constrained operations in production & supply of those goods, access to manpower, and movement & distribution of products.
Apart from the national lockdown to curb the contagion, the Government announced a relief package of Rs. 1.70 lakh crore to provide a safety net for those hit hardest by the lockdown.
CII suggests that the implementation of the fiscal stimulus package should be done in a fast track mode as the sudden imposition of the lockdown has significantly impacted industry operations and uncertainty of a recovery threatens a substantial loss of livelihoods going forward.
In the wake of the Covid-19 outbreak, that has had far reaching ramifications on the economy, the Confederation of Indian Industry (CII) has submitted its recommendations to the Government. These address many challenges that the economy is currently facing and would help in restarting the economy in a safe, sustainable and calibrated manner.
The outbreak has caused widespread economic damage along with disrupting supply chains, affecting financial markets and liquidity, along with livelihoods. The crisis is said to be worse than the financial crisis of 2008, when India was relatively in a better position compared to the current scenario.
Given that the Indian economy was already undergoing a slowdown in growth, CII’s assessment for the best estimates of GDP growth for the current fiscal under the present situation, is no more than 2%, with a downward bias. Thus, restoring the economy through timely and appropriate interventions is the urgent need of the hour.
CII has recommended a comprehensive economic package for FY 21, where the fiscal support is limited to 2% of GDP. CII’s recommendations on various aspects related to the fiscal package are as follows:
Additional support to lowest strata and informal sector
The adverse impact of the crisis would be specifically severe for the lowest strata, i.e. people at the bottom of the pyramid and the informal economy.
CII suggests an additional package for these sections, that is over and above the INR 1.7 lakh crores provided under the Pradhan Mantri Garib Kalyan Yojana, by way of providing cash transfers amounting to INR 2 lakh crores to JAM account holders.
Support to enterprises through banks
CII is of the view that supporting industry through banks instead of giving direct subsidies may prove to be more beneficial under the circumstances. CII estimates that the economy would need a credit expansion in the range of 14-15 per cent.
CII therefore requests the Reserve Bank of India (RBI) to extend the support to the industry. Interventions could include:
Addressing the liquidity issues that the economy is facing and will continue to face in the future, as a result of the crisis is imperative, to ensure that the banking and financial sectors are not overstressed and are able to maintain capital adequacy and solvency.
It is important to recognize that the economy cannot afford a bank collapse at this point of time and take pre-emptive action. CII has proposed that the Government of India sets apart a fund of INR 30,000 crores. This could be accessed by banks that meet certain criteria and under specified conditions, by way of issuing Tier 1 bonds which will be convertible at the option of the fund. This is expected to provide a buffer to the Indian banking system, by preventing deserving banks from collapsing.
The CII note submitted to the Government also includes suggestions for health, safety and getting back migrant workers with proper messaging to raise their confidence. These can be found in this blog https://www.ciicovid19update.in/blog/cii-recommendations-on-health-safety-and-others-for-restarting-the-economy-in-a-safe-and-sustainable-manner
The entire paper is available here:
10/4/2020 0 Comments
The rapidly intensifying Covid-19 pandemic has had devastating impacts across the global economy, stalling businesses operations and economic activity. The economic impact of the outbreak has been unprecedented, with the crisis seen as one of the worst ever.
While the Indian economy was very well cushioned during the financial crisis of 2008, largely on account of its sound financial system and strong growth, the current situation is different. As India was already in the middle of a growth slowdown, the Indian economy is particularly hard hit due to the outbreak.
As India went on a 21-day historic lockdown to contain the spread of the virus, the economy faces widespread disruptions, posing perhaps some of the biggest challenges to Indian policymakers. Therefore, the present situation calls for urgent measures from the Government and decisionmakers to set a strong course of action that leads to a safe and sustained revival post lockdown.
In view of the current situation, the Confederation of Indian Industry (CII) has undertaken a massive contact programme with its members, to take stock of the issues faced by them and to assess the overall impact of the pandemic and the consequent lockdown on the economy.
CII has submitted its recommendations to the Government that focus on safeguarding the macro fundamentals of the economy through a comprehensive package that would help in restarting the economy in a safe, sustainable and calibrated manner.
Besides a fiscal package, the recommendations also pertain to critical areas such as health and safety, logistics, migrant workers and coordination.
Health and Safety
CII has recommended that the Government can create a dashboard to monitor curves of various states and cities. The restart calendar across the states and cities along with the progressive ramp up, in terms of the proportion of manpower allowed to get back to work, must be based on the movement of the respective curves on the dashboard.
Secondly, extreme caution must be exercised when facilities re-open, ensuring that social distancing, screening, sanitization norms are fulfilled on a self-certification basis by all firms and shops. Penalties and closures must be in place for all violating units. Adoption of these activities could be monitored by the states.
Further, the Government must ensure the adequate availability of masks, testing and protective gear.
The logistics sector will have a key role to play in the restart of the economy, specifically in terms of seamless transportation of goods and services along with the harvest across India.
Suggested interventions include ensuring no harassment at borders and various check posts through clear and uniform instructions to police personnel; facilitating movement of truck drivers and others willing to come back by making necessary transport arrangements; allowing the opening of dhabas, diesel/petrol stations and repair shops on highways to ensure availability of basic amenities to truck drivers; extension of insurance cover to workers and families by logistic service providers, to the tune of INR 10-15 lakh for 3 months.
CII recommendations focus on two aspects of getting the migrant workers back – the willingness of workers to come back and logistical facilitation for willing workers.
Suggested measures for the first aspect include undertaking an aggressive ‘messaging’ campaign on the preparedness of the Government and the industry for a restart; facilitating tripartite dialogue between the Government, worker associations/unions and industry to address their concerns; announcing a COVID insurance scheme for the workers, with the cost borne partly by the Government and partly by industry.
For the second aspect, CII recommends issuing of e-passes to workers by local authorities ensuring smooth travel to workplaces; special transport for large clusters with safety protocols in place, among others.
Coordination between Centre and States
Effective coordination and speedy implementation between Centre and States is a crucial aspect for restarting the economy.
Setting up of an empowered group of Ministers at the central level and an interdepartmental task force led by the Chief Secretary at the state level is recommended, for planning, reviewing and addressing implementation challenges. These groups can address on-ground challenges daily basis through frequent consultations with industry.
The Centre and the States must work cohesively to ensure complete alignment between notifications/advisories and their interpretation, issued by centre and states. This could be further facilitated by templatising the notifications/advisories.