The big shrink: Trade licences down 45% in Bengaluru

All economic activities may have resumed in Bengaluru but business seems to be lacklustre.

Sample this. There’s been a nearly 45% drop in trade licences issued by the Bruhat Bengaluru Mahanagara Palike (BBMP) compared to 2019-20.

If there were 51,564 trade licences in Bengaluru by the end of 2019-20, the number is now down to just 32,257. Of these, 28,683 are renewals while new licences number a mere 3,574.

A trade licence is a document issued by the local authority that allows the trader to do a particular business in a particular locality. It is one of the most basic documents required to do business.

Traders can renew the licence without paying a penalty until February 28 or with a fine of 25% until March 31. Any renewal after April attracts a 100% fine.

But traders were so indifferent that the BBMP had to extend the renewal window to March 31. Still, there is a poor turnout, said a senior BBMP official.

During the pre-pandemic times, most of the renewals would happen by February because traders didn’t want to pay a penalty, the official said.

So what explains the low numbers?

Another senior BBMP official gave two reasons: Many traders have shut up shop or are doing business without bothering about renewing the trade licence.

“Traders have the option of renewing their licences with a fine for up to three years. For the last two years, we have not been able to inspect the trades owing to the pandemic. We suspect that many might be operating without renewal,” the official said.

Trade activist Sajjan Raj Mehta, however, said the first reason was more plausible. “The pandemic has wrecked the trading community. And the government has been of little help. Many traders have gone out of business,” he said.

Going a step further, Mehta asked the government to abolish the trade licence, saying it is nothing but a “money-making initiative”.

Citing the poor infrastructure in Chickpet, Bengaluru’s traditional business hub, he said the BBMP had “absolutely no right” to levy a fee in the name of a trade licence. “It must be abolished,” he added.

Dr A S Balasundar, Chief Health Officer, BBMP, said the civic body would soon crack down on business establishments operating without a trade licence.

“I have instructed the zonal officials to survey the traders in their jurisdiction and get them to renew their licences on spot. Also, they have been directed to shut down trades which continue to operate illegally,” he said.