While the MSMEs, which contribute nearly 50% to the Gross State Domestic Product (GSDP) in UP, are witnessing a dip in business activity following the scrapping of the high-value currency notes, the sector is optimistic about the macro economy gaining positive traction going forward.
MSME bodies have already started the process of holding training workshops, seminars and panel discussions on the topical issue, which is likely to impact the way business transactions and trade are conducted in future.
A process is underway to bring all MSME chambers onto a single platform to jointly address the consequences of demonetisation.
“Some of the MSME segments have witnessed a slowdown in their businesses owing to the cash squeeze and these effects are likely to stay for one or two quarters. However, we are hopeful that demonetisation would largely have a positive impact on the in the long run,” Prashant Bhatia, MSME chamber Laghu Udyog Bharti (LUB) UP unit office bearer and a leading industrialist told.
He said LUB has also decided to seek an appointment with Finance Minister Arun Jaitley and submit a memorandum containing recommendations with regards to MSMEs in the context of demonetisation.
The chamber is further planning to organise a workshop jointly with Lucknow University (LU) to be addressed by domain experts to demystify demonetisation for its members.
Bhatia said such sessions would continue to be organised for some time and the body would tray roping in union ministers and top experts to address such meetings to allay the apprehensions of the MSMEs.
Recently, Lucknow Management Association (LMA), an affiliate of All India Management Association (AIMA), also held a workshop on ‘Cashless Transactions: A Digital India Initiative’. LMA vice President & Executive Director A K Mathur noted demonetisation was arguably the most radical intervention in India with far-reaching economic and societal effects.
He said in the wake of demonetisation, even small traders and shopkeepers were slowly going digital and it was becoming imperative for people to start using their smartphones for making and receiving payments going forward.
The MSME sector is the backbone of the UP industrial base and is estimated to contribute 60% of the state’s annual industrial output. It directly employs roughly 40 million workforces and generates direct economic activity worth Rs 1,20,000 crore annually.
UP is home to almost 4.4 million MSMEs, which includes 4.2 million as unregistered units. The sector is the second largest employment generator after agriculture in UP.
Source: Business Standard