Detailing of the grand stimulus package, earlier today, by Finance Minister Nirmala Sitharaman, announced by Prime Minister Narender Modi on Tuesday evening, for industrial & business revival post Covid19 is more of a statement of intent by the Govt of India. How much relief this would provide and to what extent it would be instrumental in boosting the economy is a matter of conjecture at this time.
All the industry majors would be perforce giving sound bites welcoming the unprecedented package but what will ultimately matter is how much all of these grand announcements translate into ground reality. It is one thing to lay out a blue print and quite another for that intent to make it to the beneficiaries.
The Micro, Small & Medium Enterprise (MSME) is currently up against a wall in every respect of the game. From the supply chains being dismembered to loan defaults to labour issues to getting their act together for resuming production & sales is a Herculean task. It’s almost like starting afresh and not knowing the pitfalls that lie ahead.
The promised financial support is hardly any consolation since it’s a regular loan, if at all the banks are willing to go the extra mile in line with the govt intent of self-reliance & resurrecting the MSME sector. It’s almost impossible getting the financial institutions & banks to loosen their purse strings what with their unrealistic demands of financials, collaterals etc.
Personally, I never view a loan as a privilege, rather it’s a burden that any unit carries endlessly. Very few manage to get rid of the debt which is almost like an albatross round the neck and if any do, it is more by liquidating capital assets to pay off the lenders.
I rue the lack of an industrial culture in India where the bureaucracy is the biggest challenge for business to succeed. Then again the multiplicity of regulators completely saps whatever is left after one gets going with the unit. Business folks are treated pretty shabbily in the govt. and are looked upon with suspicion as though they were out to loot the economy.
Failure in entrepreneurship can be the best teacher but then it’s a huge price to pay to learn life’s lessons.
Coming back to the package, we ought not to view it as a pot of gold even at the end of the rainbow. I’ve learnt to view with scepticism the attitudes of the people who are responsible for implementing the spectacular announcements made from Delhi.
These guys lack the calibre to think big & beyond their limited sphere of office duty. We desperately need officialdom which can spot & unleash the entrepreneurial talent and bet on it instead of just dwelling on paperwork & nitty gritty.
In the absence of this, the best laid plans will come to naught and the best of intentions will remain just that. You have to allow for failure and not persecute those entrepreneurs who could not make it.
The rot in the system runs deep and unless we’re all prepared & willing to make it happen, this package will remain a pipe dream. I sincerely hope it will be otherwise
A mechanical engineer with a masters is business administration, GS Khatra is a serial entrepreneur who operated a Kraft paper mill before diversifying into other businesses. He lives in Barnala, Punjab.