Bengaluru industries press panic button, seek Covid-19 lockdown exemption

The enforcement of yet another lockdown in Bengaluru is likely to paralyse the state economy if it includes industries and export-oriented units. With 30% of MSME units yet to restart operations during Unlock 1.0 and 2.0, another round of lockdown will severely impact industrial production and hamper attempts to restore normalcy.

Many industries in Bengaluru, especially in the manufacturing sector, had slowly started operating second shift in the last few days to service export orders. At this stage, another lockdown will destroy the morale of managements and workers, according to industries.

Bengaluru contributes to around 70% of the gross state domestic product (GSDP). Companies in areas like agri-business, food processing, aerospace components, machine tools, pharmaceuticals, garments and automobiles operating in the city are engaged in exports. Among the export-oriented units from Bengaluru are: BEL and HAL in the area of defence, Dynamatic Technologies, Boeing and Rolls Royce in aerospace components sector while Toyota Industries Engine India exports passenger car engines.

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"We are confident that the government will follow the examples of Pune, Chennai and Delhi where social lockdown was imposed but industries were allowed to operate with adequate safeguards. We hope the government will consult all the industry stakeholders while formulating detailed guidelines," Devesh Agarwal, MD, Jesons Technologies and President, Bangalore Chamber of Industry and Commerce (BCIC), told DH.

The industrial sector contributes around 26% to the GSDP. Closure of industries at this stage will not only impact production and cause loss of jobs but also hit the state's GST collections, he said.

The industries in Bengaluru had just started showing signs of recovery and another round of restricts will harm them badly, said Sandeep Singh, MD, Tata Hitachi Construction Machinery Co Ltd. "Although we support the government in its initiative to control the pandemic, it should have consulted the industry chambers before taking such a decision,” Singh said.

In case the industries are not exempted from lockdown, it will have a big impact on the export market which is slowly picking up and another lockdown at this stage will destroy the confidence of the export-oriented companies, said T R Parasuraman, deputy managing director, Toyota Industries Engine India Private Limited.

BengaluruIt will also result in reverse migration of workers and it will be difficult for industries to bring them back to the city. “This will further jolt the industries and the state economy,” Parasuraman, who is also the Sr Vice President of BCIC, said.

The lockdown will also impact the financial institutions which have disbursed around 65% of the loans sanctioned as part of the Rs 3 lakh-crore emergency package announced by the finance minister recently.

Bengaluru’s industrial estates get a large number of workers from neighbouring states like Tamil Nadu, Andhra Pradesh and Kerala.

The re-imposition of lockdown will cause back-breaking losses to the MSME sector which has seen a shutdown in the range of nearly 30%. The hotel industry has witnessed barely 2% in room occupancy and restaurants have seen negligible footfalls. A lockdown at this juncture will further damage their business, Agarwal added.