MSME body AICA calls for closure of industries on Dec 20th

All India Council of Association of MSMEs (AICA), an umbrella body of 200 MSME associations, has called for closure of industries across the country on December 20 to protest against the spiralling prices of various raw materials.

One-day closure of all industries across India on Monday, the 20th Dec 2021 and one-hour peaceful demonstration in front of the respective Collectorate/District Magistrate Office to press for the intervention of the Hon’ble Prime Minister to reduce raw material prices at the level of prices prevailed during April 2021.

About 10 lakhs MSMEs across pan India are closing their operation for a day in support of this call by AICA which will result in a production loss of Rs.25,000 crores, in addition to loss of employment for many.

Major Associations such as CODISSIA, TANSTIA, SIEMA, ICCIC, IIF, ARISE etc. will be taking part in this one-day closure and demonstration and MSMEs from other States like Punjab, Haryana, Orissa, Assam, Karnataka (Entire Belgaum region), Gujarat, Maharashtra, Karnataka, Tamil Nadu, Andhra Pradesh, Maharashtra and Madhya Pradesh are supporting us by closing down the operations of their member industries on 20.12.2021.  

MSMEs are the backbone of this economy, contributing to 30% of GDP, 48% of Exports and creating job opportunities to 12 Crore people, which translates to about 40 Crore people of India (one-third of our population approximately) who are dependent on these MSMEs.

MSMEs are faced with huge challenges like –
 Sustenance at stake due to erosion of Working Capital on account of huge rise in prices of    
Raw Materials like steel, iron ore, Aluminum, copper, plastics, PVC, paper, chemicals etc.
 There is no price escalation clause for public sector projects.
 It appears cartel working together at the cost of Country’s Interest.
 Open Market not accepting full effect of Raw Material Price Increase.
 Non availability of basic raw material.
 Blocking and Stocking of Raw Material in the entire supply chain.

Possible Solutions to overcome this crisis:

1. Request for reducing the raw material prices which was prevailing during April 2020 and fix MRP (maximum retail price) for all raw materials.
2. Protection against escalation for some period
3. PSUs to accept cancellation of orders, receive fresh quotes from MSMEs
3. Formula should be derived for price escalation
4. Quota for MSMEs at concessional price
5. GST based funding
6. Allow import based on cost and quality

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