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COVID-19 completely shuts down 10% industries, businesses



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By Laxman Kafle
Kathmandu, Feb. 14: Most of the micro, cottage and small industries have been completely shut down due to COVID-19 pandemic.
According to a study about impact of COVID-19 on industries released by the Ministry of Industry, Commerce and Supply, micro, cottage and small industries are the most affected by COVID-19.
The study has shown that no industry is fully operational due to the lockdown caused by COVID-19. Of the industries participating in the study, 10.81 per cent are completely closed and 89.19 per cent are partially operational.
Out of total closed industries, the share of micro, cottage and small industries is 75 per cent.
The production capacity of 54 per cent industries has declined by 50 per cent; 32.43 per cent by 75 per cent; and 23.52 per cent by 75 per cent, the report said.
According to the ministry, the study was conducted with the participation of a total of 37 industries, including 17 micro and cottage industries, eight small scale industries, four medium scale industries and eight large scale industries.
On the basis of percentage, 22 per cent large industries, 46 per cent small scale industries, 11 per cent medium industries and 21 per cent small industries were covered in the study.
The ministry had compiled the data from November 2 to December 1, 2020. The study was joined by industries and businesses producing goods and services including jewellery, paints, cement, copper and brass utensils, hydropower generation, handicrafts, readymade garments and consultancy.
Studies have shown that COVID-19 has affected the production and marketing of all medium-sized industries. In the case of large scale industries, raw material procurement, production of goods and services, labour mobilisation and marketing have been affected.
Similarly, 82.35 per cent of the micro and cottage industries participating in the study said that production had been affected due to COVID-19 and it was difficult to get raw materials.
About 87.5 per cent responded that the production of small scale industries was directly affected and 75 per cent said that it was difficult to get raw materials and 87 per cent of industries said they had an impact on labour mobilization and product marketing.
Similarly, 50 per cent of the medium industries participating in the study had problems in obtaining raw materials and 75 per cent of the industries had problems in mobilising workers.
Large industries, on the other hand, said that raw material procurement, production of goods and services, labour mobilisation and marketing were all affected.
Most of the industries were at loss due to COVID-19 and only 16.22 per cent of the industries participating in the study were in profit. Of the profit earning industries, 66.67 per cent were large scale industries.
Looking at the situation of job losses, the highest number of losses were in small scale industries. After that, medium and large scale industries saw the job losses. In terms of gender, men lost a significant number of jobs compared to women.
At the same time, according to the ministry, production of goods and services has also declined due to the decline in the operating capacity of industries and businesses during the COVID-19 pandemic.
The participants in this study have demanded that the government should give a special discount on the interest rate for the full operation of the enterprises.
According to the ministry, the industrialists have suggested that loans be provided at concessional rates, special tax rebates be given, demand charge for electricity be determined on the basis of production, value added tax be refunded, refinancing be provided and house rent waived.