NEW DELHI: The FIEO has shared in a letter to the Commerce Secretary  that, the partial lifting of lockdown is being allowed in a phased manner and thus its effect will be visible only after a few days. Many states have hitherto not issued the SOP based on which industry will evaluate its preparedness before applying for permission. Few states like Delhi, Karnataka, Tamil Nadu and Telangana have not provided any relaxation as enumerated by MHA in its revised guideline of 15th April 2020. Many important industrial townships continue to be in the Red zone like Mumbai, Pune, Hyderabad, Ahmedabad, Bhopal, Indore, Kanpur, Agra , Varanasi etc .

“At a few places in green or rural areas, manufacturing has not started as ancillaries providing important part/ components are in the red zone, thus continuous manufacturing is not viable. In some cases, the industry already has sufficient stock of the manufactured products which should first be put into distribution before commencing production. Similarly, for many auto clusters, the manufacturing hasn’t started as the distribution channels have not been opened yet. A lot of MSMEs are unable to open their factories as they lack the liquidity to purchase the raw materials and other inputs. In many cases, the manufacturing units are unable to procure raw materials as factories producing them are in the Red zone and thus are unable to supply the materials.

Some of the food processing units have reported that they are not getting the raw material as the village panchayats do not allow anyone to enter the village to procure such raw materials. For cashew industry, the raw material is procured through APMC but since APMC isn’t functioning, the cashew units are finding it difficult to get raw materials to start production. The labor shortage is across industries and even affecting the transportation sector very badly, which is also deterring units from opening.

Lack of consistency in allowing units to open and then shut is also creating problems for the industries. In Karnataka, industries were all set to open but at the eleventh hour, the state government withdrew the permission. Similarly, in Mandideep industrial area in Madhya Pradesh, the permission was granted but withdrawn today. Such inconsistencies lead to uncertainty which affects the operation of the industries.

“The industry is concerned with many restrictions and responsibilities imposed by the Revised guidelines/ SOP which are also coming in the way of starting  the unit:

a)   Clause 15.2 of the Revised guidelines require the stay of workers to be within the premises or in the adjacent building or requires their transportation in a dedicated vehicle:  Many units, particularly MSMEs, neither keep workers within the premises nor can quickly arrange to put them in an adjacent building. Since the private transport is not available and wherever available, its charges have skyrocketed, units prefer to wait till the lockdown is over. If workers are allowed to use their cycles/2 wheelers it can solve the problem of many units. Since state buses are not generally plying, such buses may be given to manufacturers for transportation on reasonable charges. It will be a win-win situation for both sides.

b)   Point No 5 of SOP: Requires medical insurance of workers which creates a problem since workers are supplied by the contractor as many industries do not have workers on their pay roll. Since workers on payroll have ESI facility and contract worker may be covered by “Ayushmaan Bharat “ scheme, this requirement may be relooked into.

c)   Point No 6 of SOP: Provision of hand wash and sanitizer preferably with touch-free machine at entry, exit and a common area. states are interpreting the word “preferably” as mandatory asking industry to provide only touch-free machines, which are very costly and in short supply.

d)   Section 58 of the Disaster Management Act (Annexure III):  The said section is interpreted differently by the states. Some of the functionaries of the states are explaining that if any Covid-19 case is found, FIR will be filed against the owner(s) which requires suitable clarification from MHA. It is better if the responsibility of the owners(s) / management is detailed by the MHA / States.

e)   The detailed guidelines also talk about sealing of the factory if any Covid-19 case is detected. The sealing process is quite complicated and it may take 3-6 months’ time for any industry to get permission to unseal it. Many units are therefore reluctant to open as such a situation is not ruled out. The industry is apprehensive as Covid-19 cases are on the rise and if the factory is sealed suddenly, the industry will be saddled with the cost of inputs as well as output, in addition to the fixed costs.

“These are some of the challenges reported to us. We shall be updating you further in the matter after a couple of days as many units are waiting to get permission while many are preparing to comply with the SOP, said a FIEO letter to Commerce Secretary.