Addressing media persons, Raju said the layoffs took place due to economic slowdown. Over 30% of industries in Karnataka have been closed down or paralysed, he said. It is the micro and small scale industries that are hit due to the slowdown in automobile sector, he said.
President of Karnataka Small Scale Industries Association (KASSIA), R Raju, on Saturday claimed that the economic slowdown has affected micro and small industries across the country and in Karnataka alone nearly 15 lakh workers have lost their jobs in the past few months.
Addressing media persons, Raju said the layoffs took place due to economic slowdown. Over 30% of industries in Karnataka have been closed down or paralysed, he said. It is the micro and small scale industries that are hit due to the slowdown in automobile sector, he said.
Among them, the garment factories are the worst affected, Raju said. Majority of those who lost jobs are from the garment sector. One of the reasons for rise in unemployment is the wage policy. Micro and small scale industry owners cannot afford to pay Rs 15,000 to workers, Raju said. He urged the Union government to cancel its policies on including SMEs under the wage policy.
Among the suggestions given to the Union government by KASSIA, was the demand to raise the credit guarantee cover up to Rs 5 crore for SMEs keeping in view the changing business needs and the need for adequate finance for operations.
With regard to GST, the government should formulate a policy to pay the interest on refund amount from day one to avoid the SME paying the interest twice on the same amount. On the Prime Minister’s initiative on loan in 59 minutes, Raju stated that it should be made mandatory that banks display on notice boards the statistical information of loans disbursed under the scheme.
The KASSIA members also spoke against shifting of SIDBI from Bengaluru to Hyderabad. Raju lamented that if the government does not make changes in the economic policies, the recession period would continue for a year or two and more workers would be unemployed. Raju demanded not to change the definition of MSME on the basis of turnover, rather it should be based on the land and machineries.
