As part of PM Narendra Modi’s Rs 20 trillion Atma Nirbhar Bharat Abhiyan (ANBA), or Self-reliant India Mission, FM Nirmala Sitharaman announced six regulatory measures, especially for MSMEs, to weather the fallout of coronavirus pandemic. 

Though ANBA tries to address some of the hindrances in raising India’s competitiveness in the global market, there is a need for a deeper introspection (Atma Chintan) to understand the immediate roadblocks and those that can help build scale in the longer term. Only that will provide them with Atma Vishwas (Self-Confidence).

At our webinar titled ‘Will PM Modi’s Economic Package Revive Indian Businesses’, with panellists including Vinayak Chatterjee, Chairman, Feedback Infrastructure, Harshvardhan Neotia, Chairman, Ambuja Neotia Group, Madan Sabnavis, Chief Economist, CARE Ratings and Pradeep Singh, Former Advisor – Infrastructure, Government of Jammu & Kashmir, we conducted a poll, inviting over 1,000 registered attendees to select one among five options as the most critical measure of relief they were seeking. The options were:

The fifth option was the most preferred, followed by the third option, which would give businesses direct cash relief in paying wages and salaries of their employees for three to six months. Several countries have provided this kind of relief as it ensures that employees get to keep their jobs while easing the burden on the employer.

At the company level, majority of them (with a few exceptions) lack the appetite to invest in R&D and modern manufacturing technologies to raise their standing in the global marketplace. Also, Indian entrepreneurs are more inward looking; focusing on the local market needs. Further, ANBA is only offering indebtedness by extending loans and the MSME sector is quite reticent on leverage. On a year-on-year basis, non-food bank credit growth decelerated to 7.3 per cent in April 2020 from 11.9 per cent in April 2019. Only large industries reported a positive credit growth of 0.6 per cent between March and April 2020.

It has been proved that whenever entrepreneurs are given conducive environment, they are capable of turning a crisis into an opportunity. Like when the country needed millions of personal protective equipment (PPE) kits for its healthcare workers fighting COVID 19 pandemic, many companies (mostly SMEs) ramped up production manifold in no time. As a result, today India is the second largest manufacturer of PPE suits in the world. A combination of proactive government policies, hyperactive government agencies and resourceful & motivated entrepreneurs made this possible. 

The convergence of two perfect factors - the pandemic and the geopolitics-driven disruptions recently seen in global trade and investment flows - may present India an opportunity to become one of the key nodes of the global value chain. Question is: Are we ready to seize it?

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