MSME

‘MSMEs must have contingency planning’

G Balachandar Chennai | Updated on June 26, 2020 Published on June 26, 2020

X Arokianathan, Past Co-Convenor, MSME Panel, Confederation of Indian Industry-Tamil Nadu.

In view of Covid-19 disruption, India has announced a vision of achieving self-reliance and MSMEs are expected to have a big role in this objective. In this context, X Arokianathan, Past Co-Convenor, MSME Panel, Confederation of Indian Industry-Tamil Nadu, spoke to BusinessLine about the challenges and opportunities on the eve of International MSME Day. Excerpts:

What will be the key learnings for MSMEs from Covid-19 crisis?

The Covid-19 pandemic is an unprecedented event and has caught everyone off guard without any clue as to how to handle the situation. It has taught us a lot of lessons. We can’t keep all eggs in one basket and businesses must have more verticals so that if one fails the other can support. Also, we should not be dependent on one customer or one sector. We have to adjust to new normal like WFH, which is more streamlined and organised, while virtual meetings and conferences save time and money on travels. MSMEs must have business continuity and contingency planning, ‘what if’ analysis and digital marketing tools.

How do you see the role of MSMEs in achieving government’s self-reliant India vision?

MSME can play a major role in the government’s ambition provided they are given a level-playing field and opportunity. A major bottleneck is finance. If MSMEs can get their money due to them promptly from all the concerned private or government customers there will be tremendous growth and prosperity. Complying with government regulations and requirements drains away most of the time and energy of technocrat entrepreneurs.

Is the availability of skilled labour a big challenge for MSMEs?

Yes. It is very unfortunate that our education system is far from satisfactory in equipping our young workforce to take up skilled jobs. ITIs and polytechnics imparting skills is the need of the hour to make our youth work-ready and self-reliant. The great disparity in pay scales has tilted the balance from manufacturing to soft skills.

There is a view that a huge number of MSMEs do not have information about the various support schemes of the government. What are your views?

The government schemes are being informed to MSME through various medium and industry bodies. But there needs to be clarity between States and Centre and a clear simple advisory needs to be made. The informal sector may not be well informed and do not get support from the banks /financial institutions.

What transformation have you witnessed among the manufacturing MSMEs in the recent decade?

A lot of transformation has taken place in the manufacturing MSME sectors. Under pressure from OEMs they have upgraded the shop floor machinery to produce better quality products, they use analytical tools, AI, digital transformation, design & analysis software and this has helped a long way in achieving global standards. Automation has helped improve quality and productivity.

Published on June 26, 2020
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