As the 21-day lockdown, to curb the COVID-19 pandemic, nears its end, the government and India Inc are working together on business continuity plans. The government has asked industry bodies and manufacturers’ to share key concerns and requirements to begin manufacturing activity. The manufacturing industry is preparing to resume operations when the nationwide lockdown ends and is focusing on bringing production back to the pre-lockdown levels.
Leading electronics players are holding virtual meetings with stakeholders and government officials to chalk out a resumption plan, being monitored by an empowered group of ministers (EGM). The EGM is expected to take a call on allowing electronics manufacturers to start production.
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Manufacturers are making all preparations to recommence operations at all locations on lifting of lockdown in the next few days. Many would like to begin production with a lower capacity and then gradually scale it up. While a few are technically ready to start production as and when the lockdown is lifted, there are others who say they would take a call on restarting production closer to the date and once they have clarity. There are a few units who have stated that after withdrawal, a minimum of 15 days would be required to streamline operations.
All this comes at a time when the Prime Minister, Narendra Modi, has sought has sought ways and means from his ministers to bolster domestic manufacturing as the pandemic has brought home the fact that essential goods manufacture within the country is very important. In fact the Prime Minister has asked the ministers to see how ‘Make in India’ could be worked out in this scenario. Apart from this, he has also asked them to coordinate with the district authorities for not just harvesting and procuring agricultural produce but also preparing business continuity plans to address the economic situation once the containment ends.
In the present scenario manufacturers are citing logistics as a big hurdle. Availability of truckers for customers to unload material is a big issue. Manufacturers who are still continuing their business operations are delivering material to the nearest railway station to customers, who in turn are arranging the local transport to take it to their facility. To this end a representation has been made to the government to fast-track shipping of goods from key ports, like Mumbai, so that transport time between Mumbai port and factories in north India can be cut by two days.
Apart from logistics, availability of labour is yet another challenge facing the manufacturers. According to a YES Securities note, based on interaction with stakeholders of cement sector, after withdrawal, a minimum of 15 days would be required to streamline operations and that recovery is expected to be gradual as it may take longer time for labour to return. There was mass exodus of labour from different parts of the country pre and post announcement of lockdown. While a few companies say they are in contact with their workforce and that they would be back once lockdown is lifted. However, it is not true for many others. Their fears are not unfounded; for even if lockdown is partially lifted, interstate movement of workers will continue to be a problem since free movement will not be allowed. They say that factory workers can only be brought back if there is assurance of advance payment and compensation, besides safety at the workplace. The auto-ancillary industry, one of the worst hit due to labour exodus, is expected to take at least three months to get its manufacturing units up and running.