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Business EYE APRIL 23, 2021 | The Indian Eye 42

economy on track,

says fm as small businesses take

a bit hit of pandemic

Fitch Ratings says the resurgence of infections may delay India’s economic recovery

Our Bureau vestment, setting up DFI, look-

New Delhi ing at the asset reconstruction
company (ARC), everything is
ver three-fourths of on course,” the minister said
small businesses in the when asked whether the second
Ocountry have shown an wave will derail budget proposals.
adverse impact on their health The government plans to gar-
during the Covid-19 pandemic, ner Rs 1.75 lakh crore by selling
with those in the manufacturing stakes in state-run companies,
sector reporting more troubles, including privatization of two
according to a survey. The sur- banks and one state-run general
vey, conducted by data firm Dun insurance company.
& Bradstreet has shown 82 per However, Fitch Ratings on
cent of businesses have experi- Thursday said the resurgence
enced a negative impact during of Covid-19 infections may de-
the pandemic year. The survey lay India’s economic recovery,
was conducted among over 250 but won’t derail it, as it kept the
companies, evenly split between Union Minister of Finance and Corporate Affairs Nirmala Sitharaman sovereign rating unchanged at
the manufacturing and services addresses businessmen, entrepreneurs, and representatives from ‘BBB-’ with a negative outlook.
industries, having a turnover of the social sector at an interactive session on 'Creating Atmanirbhar It projected a 12.8 per cent re-
Rs 100-250 crore yearly. Bharat', in Kolkata on Tuesday. (ANI) covery in GDP in the fiscal year
Over two-thirds of those ending March 2022 (FY22),
surveyed, or 70 per cent, said it per cent). the minister said, has been tak- moderating to 5.8 per cent in
will take them nearly a year to The company said its com- ing steps to deal with the second FY23, from an estimated con-
recover demand levels prior to mercial disruption tracker indi- wave of Covid-19 with regard to traction of 7.5 per cent in 2020-21.
Covid-19. Over the past year, cated that around 95 per cent supply of medicines and oxygen. Fitch had in June last year
India has emerged to be one of of firms were impacted in April While the second wave of the revised outlook for India to ‘neg-
the worst-affected nations glob- 2020 when the national lock- pandemic has been challenging ative’ from ‘stable’ on grounds
ally by the Covid-19 pandemic. down was imposed, and 70 per on many levels, the government that the coronavirus pandemic
The resultant lockdowns, which cent remained disrupted as of has been taking decisions, in- had significantly weakened the
are springing up again across the August even with progressive cluding on import of medical country’s growth outlook and ex-
country with rise in cases, have unlocking, which came down to oxygen, and boosting supply of posed the challenges associated
an impact on the economic front 40 per cent by end of February medicines, she said at a webinar. with a high public debt burden.
as demand disappears along 2021. “We have to wait and watch a bit India enjoyed ‘BBB-’ rat-
with dip in income generation. Citing its interactions with and then we have to take a call... ing since the upgrade in August
Around 60 per cent of the small businesses over the last but at the moment activities are 2006, but the outlook has oscil-
companies surveyed expect more two decades, the company said all happening, industry is still on lated between stable and nega-
measures and support, includ- access to markets and better its recovery mode, and therefore, tive. In affirming ‘BBB-’ rating,
ing government initiatives, the credit facility has been the major I won’t rush to think that this will Fitch on Thursday maintained a
survey focused on companies in challenges in scaling up their op- hurt us if we are able to coordi- negative outlook for the rating,
seven metro cities, said. The top- erations. nate better,” she said. reflecting “lingering uncertainty
three challenges earmarked by But, Finance minister Nirma- She further said budget pro- around the debt trajectory”.
the surveyed companies, which la Sitharaman on Thursday said posals with regard to disinvest- “India’s rating balances a
might hinder small businesses to the industry is in recovery mode ment and setting up of develop- still strong medium-term growth
scale up their businesses, include and several budget proposals are ment finance institution (DFI) outlook and external resilience
market access (flagged by 42 per on course, including disinvest- are on course. “This morning from solid foreign-reserve buf-
cent), improving the overall pro- ment, despite a fresh wave of when I met with secretaries, the fers, against high public debt, a
ductivity (37 per cent) and hav- coronavirus infections and local mood and also the way in which weak financial sector and some
ing access to more finance (34 lockdowns. The government, we have planned out for disin- lagging structural factors.

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