May 3: The lockdown imposed by the government to control the spread of coronavirus has been affecting small and medium sized industries across the country. Small and Medium Scale Enterprises (SMEs) are in crisis as production and supply have come to a standstill due to the month-long lockdown.
Due to such unprecedented circumstances, stakeholders opine that the entire economy will be affected by the current crisis.
Economist Dr Govinda Nepal informed new Business Age that the lockdown and coronavirus crisis have affected SMEs the most around the world.
He informed that all such enterprises are the most vulnerable during the current crisis.
The small and medium scale industries are affected by minor risks and eventually force them to shut down.
“Even small risks can cause such industries to close down quickly. However, the government should provide short-term relief, soft loans and refinancing to save such industries from crisis,” he informed.
Experts also suggest that the state must take appropriate decision to save such industries from crisis. Small and medium industries and enterprises contribute a lot in creating employment opportunities.
Restaurants, handicraft industry and poultry farms which are part of small and medium industries have been providing direct and indirect employment to about 2.4 million people in Nepal and are contributing 22 percent to the country's gross domestic product.
At present, poultry industry is bearing a daily loss of around Rs 220 million. Likewise, restaurants have been shut for more than a month.
There are about 2,500 restaurants in Kathmandu, Chitwan and Pokhara making a daily turnover of Rs 70 million. Similarly, the handicraft industry, which employs around one million people, is also in crisis.