Impact of COVID-19 on Indian SMEs and Survival Strategies

Impact of COVID-19 on Indian SMEs and Survival Strategies

Dileep Baburao Baragde (G. S. Moze College, Savitribai Phule Pune University, India) and Amit Uttam Jadhav (G. S. Moze College, Savitribai Phule Pune University, India)
DOI: 10.4018/978-1-7998-7436-2.ch014
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Abstract

India has been affected by the worldwide COVID-19 pandemic, which is dispensing two sorts of stuns on nations: health stun and a monetary stun. Given the idea of the infection, which is exceptionally infectious, the ways to contain the spread incorporate strategy activities, for example, burden of social removing, self-seclusion at home, closure of foundations and offices, limitations on versatility, and even lock-down of a whole nation. These activities can prompt desperate ramifications for economies around the globe. In other words, effective control of the infection requires the economy of a nation to stop its typical working.
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Introduction

India in a worldwide Covid-19 pandemic, which is dispensing two sorts of stuns on nations: health stun and a monetary stun. Given the idea of the infection which is exceptionally infectious, the ways to contain the spread incorporate strategy activities, for example, burden of social removing, self-seclusion at home, closure of foundations, and open offices, limitations on versatility and even lock-down of a whole nation. These activities can possibly prompt desperate ramifications for economies around the globe. In other words, effective control of the infection requires the economy of a nation to stop its typical working. This has set off feelings of dread of a profound and delayed worldwide downturn. On April 9, the head of International Monetary Fund, Kristalina Georgieva said that the year 2020 could see the most noticeably terrible worldwide financial aftermath since the Great Depression during the 1930s, with more than 170 nations prone to encounter negative per capita GDP growth due to the furious Covid pandemic. The world has seen a few pestilences, for example, the Spanish Flu of 1918, flare-up of HIV/AIDS, SARS (Severe Acute Respiratory Syndrome), MERS (Middle East Respiratory Syndrome) and Ebola. In the past, India has needed to manage sicknesses, for example, the little pox, plague and polio. These separately have been truly serious scenes. Anyway the Covid-19 which started in China in December 2019 and over the next scarcely any months quickly spread to practically all nations of the world can possibly end up being the biggest wellbeing emergency in our history. Numerous specialists have just called this a Black Swan occasion for the global economy.

The Corona pandemic which prompted complete and halfway lock down over the countries creating extreme interruption to exchanging of goods, administrations and development of persons is influencing India's exchange which as of now had witnessed pessimistic development 2019. The COVID-19 influenced economies, specifically, the US, China, Italy, Spain, Germany, South Korea, France, the UK, are the significant center points of GVC sand worldwide exchange. India's declining exports starting from pearls and adornments to pieces of clothing/attire or ocean depths are principally sent out to these nations influencing a huge number of jobs. The MSMEs, which are the foundation of India's outside fare contributing almost 49% to the nation's fares, need critical consideration regarding get back on track. Moreover, the lockdown in these nations has brought interruptions in the gracefully chains and production systems across segments, which have just influenced India's manufacturing, trade, work and development. Truth be told the aftermath of Covid-19 on India's exchange is noticeable as both fares and imports (year-on-year basis) fell by 30% in March 2010, thought about to March 2019. Little and medium endeavors in India, which ingest the second biggest work power after farming, are firmly connected to exports as well as intensely depend on imports for their productions. In reality, a portion of the industries depending on imports such as automobiles, drugs, gadgets, telecom gear, PC equipment, modern machines and hardware, and so forth will have to operate at much beneath their ability due to lack of sources of info and intermediates. Further, the domestic lockdown has influenced these small firms from both homegrown interest and supply sides. On the off chance that the general circumstance drags out for a few more months, numerous little and minuscule firms may stop to exist on the off chance that they are not financially supported by the administration in this difficult phase.

Key Terms in this Chapter

ESIC: Employers State Insurance Corporation.

NSIC: National Small Industries Corporation.

IMF: International Monetary Fund.

GDP: Gross domestic product.

CII: Confederation of Indian Industry.

RBI: Reserve Bank of India.

EPF: Employment Provident Fund.

MSME: Micro, small, and medium enterprises.

CMIE: Center for Monitoring Indian Economy.

AIMO: All India Manufacturers Organization.

SARS: Severe Acute Respiratory Syndrome.

ITC: Information technology communication.

EU: European Union.

MERS: Middle East respiratory syndrome.

PC: Personal computer.

GVC: Global value chain.

GVA: Gross value added.

GST: Goods and services tax.

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