Page 7 - Plastics News April 2020
P. 7

COVID-19: Economic Impact on Plastic Industry & Suggestions

         AIPMA's  recommendations  to  various  ministries  on      sector employees in Plastic industry
         Economic  Policy  Measures  that  can  benefit  the
         companies in the Plastic Sector                           Ø MSMEs  in  the  plastic  industry  demand  a  certain
                                                                     amount  of  time  period  (grace  period)  from  the
           In Communication with Government Of India                 Banking sector. The biggest demand due to troubled
                                                                     times  faced  at  the  hands  of  Covid-19  pandemic,
            1.  Commerce Secretary, Ministry of Commerce and
                                                                     some  payments  like  interest  payable  and  credit
               Industry
                                                                     installments owed to the banks may be delayed.
            2.  Secretary  DCPC,  Ministry  of  Chemicals  and       Routine defaults / delay in retiring LCs, if any, may
               Fertilizers                                           be allowed with an extension of 30 days by banks.
            3.  Finance Secretary, Ministry of Finance             Ø The Banks should keep patience and not declare the
                                                                     micro,  small,  medium  enterprises  as  Non-
            4.  Secretary, Ministry of Micro, Small and Medium       performing  assets.  Moratorium  of  interest
               Enterprises                                           payments for the next 6 months is likely to help
                                                                     companies  survive  this  economic  crisis.  EMI's  to
            5.  Principal  Secretary  of  the  Prime  Minister  of
                                                                     banks and NBFC to be put on hold for 6 months with
               India
                                                                     no levy of interest or delayed payment.
         As you are aware, the impact of COVID-19 outbreak has
         been  widespread  –  the  economic  impact,  impact  on   Ø Companies should be allowed to retain 10% of the
                                                                     Goods and Services Tax (GST) payable for the next
         business  operations  and  our  day  to  day  lives.  It  has
         emerged as the biggest concern, crippling economy and       12 months. The due date to furnish the GST and
         increasing the risk of recession.                           other compliances of all statutory returns, such as
                                                                     ESI,  EPF,  TDS  including  GST  returns/payment  of
         With the ongoing health crisis and enormous demand for      taxes should also be extended to 4 months after the
         medical  items,  pharma  and  food  products,  plastics     virus-infection and outbreak subsides as the market
         industry is proving to be the savior of the planet and      will take time to come back to its normalcy.
         boon to the mankind. However, the plastics industry is
         facing enormous existential crisis and challenges due to   Ø Relax  compliances  including  receipt  of  foreign
         on-going global situation and shutdowns.                    remittances  during  this  period.  RBI  to  change
                                                                     definition of NPA recognition from 90 days to 180
         These are clearly uncertain times, one which require        days till September 30.
         expeditious redressal measures from the Government of
         India- especially on policy, fiscal and monetary front.    Ø Extend due date for filing SEIS/MEIS claims for the
                                                                     period. And also for other schemes offered to MSMEs
         However, in order for the plastics industry to stay afloat   like  the  Cluster  Development  Scheme,  Public
         and survive the on-going crisis, AIPMA represented the      Procurement Scheme, UdyogAadhaar memorandum
         Plastics Industry and urgently requested Government of      and Zero Defect Zero Effect.
         India to take necessary measures with recommendations
         and  suggestions  on  the  Economic  Impact  on  Plastic   Ø Require the 'Grievance Monitoring System' network
         Industry.                                                   offered by the Ministry of MSME to come up with
                                                                     relevant options of support in this time of dire need.
         Economic policy measures that can benefit companies
         in the plastic sector-                                    Ø Credit  linked  Capital  Subsidy  Scheme  should  be
                                                                     relaxed  for  companies  facing  deep  financial
         KEY ISSUES / RECOMMENDATIONS                                distress, as the credit score might be disturbed for
                                                                     few upcoming months and financial cycle of 2020-
           Ÿ Introduce policy measures for banking
                                                                     21.
           Ÿ Allow deferred GST payments/ Provide tax reliefs
                                                                   Ø Property tax for the FY 2020-21 to be reduced to
           Ÿ Measures to provide relief to general public            half for all commercial properties.
           Ÿ Relaxation in Labor Laws & compliances                Ø GST  filling  for  Feb  and  March  2020  should  be
                                                                     extended until June 2020
           Ÿ Provide Flexibility to CSR funds
                                                                   Ø No interest should be levied on delayed payments.
           Ÿ Easy Licensing to manufacture protective gear
                                                                   Ø Give  extended  time  to  make  tax  payments  as
           Ÿ Introduce  sustenance  packages  for  impacted


            APRIL  2020                                      4                                      Plastics News
   2   3   4   5   6   7   8   9   10   11   12