P Chidambaram - India News

Tomorrow is the last working day of the month. More than 12 cr people are waiting with bated breath to know if they will be paid their salaries : P Chidambaram

AICC Press Briefing By P Chidambaram, former Union Finance Minister via video conferencing :

  • Tomorrow is the last working day of the month. More than 12 crore people of India are waiting with bated breath. They want to know if they will be paid their salaries/wages for the month of April.
  • There is palpable tension and rising uncertainty among the working people of India and their families.
  • According to Annual Report of Ministry of MSMEs, 11 crore people are engaged in 6.3 crore MSMEs. Most of them would not have worked a single day in April because entire country was in a lockdown imposed to contain the coronavirus pandemi.
  • How will these people feed themselves and their families without an income? These 11 crore people‚Äôs livelihoods are in danger now because most of the employers are unable to pay wages/salaries.
  • The businesses have had no sales this month and their payments to their vendors are also stuck, leaving the vendors also in distress. Large swathes of the private sector are faced with what economists call an extreme liquidity shock.
  • These businesses are unsure about their future. They don’t know whether they can continue business or will be forced to shut permanently. Time to make bold decisions to save MSMEs is now. If businesses don’t see hope, they’ll decide to close.
  • The Government of India has to step in today to protect 11 crore Indians and give hope to MSMEs. It is bewildering that there has been absolutely no financial package or assistance announced for businesses since the onset of COVID-19.
  • The Government may have the luxury of time but the MSMEs do not. They need to know right away whether they will be helped to stay afloat and thereby pay salaries/wages to those dependent on these businesses.
  • Congress party has submitted a proposal with specific, well thought out & concrete suggestions to help 6.3 crore MSMEs. We urge the PM to look at that proposal and immediately announce the implementation of two specific recommendation.
  • The recommendations are:

    1. Rs 1 lakh crore Wage Protection assistance to help MSMEs pay wages and salaries for the month of April.

    2. Rs 1 lakh crore Credit Guarantee fund for MSMEs that will help them to go to the banks and borrow money.

    3. Further, for the non-MSMEs, we urge the government to announce a Paycheque Protection Program, similar to the one announced in the United States. This is not a legislation but a financial assistance package.

    4. According to the income-tax department, there are roughly 1 crore people with a salary income of less than Rs 3,50,000 a year or Rs 30,000 a month.

    5. Assuming avg salary of Rs 15,000/month for the 1 crore people, total cost comes to Rs 15,000 crore for April. This isn’t a large sum to protect livelihoods of 1 crore people who’ve filed tax returns & paid taxes in past & can be easily found.

    6. The government must announce a Paycheque Protection Program right away to protect the salaries of these 1 crore employees.

    7. Time is of essence. In absence of a clear signal of assistance from Govt during these times, private sector will be forced to resort to large scale retrenchments & layoffs that’ll devastate livelihoods of hundreds of millions of people.

    8. We urge the Prime Minister to step in urgently and announce an assistance package to protect the wages/salaries and pay cheques that are due in the next few days.

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