RESUMPTION OF

ECONOMIC ACTIVITY
DURING LOCKDOWN 2

A SURVEY

25 April 2020
 RESUMPTION OF ECONOMIC ACTIVITY
DURING LOCKDOWN 2 – A SURVEY

I. INTRODUCTION

The outbreak of the COVID-19 pandemic and the subsequent lockdown has resulted in
an abrupt disruption in the supply chain. Firms are now facing the brunt of reduced / nil
sales volumes, even as they continue to incur large expenses, raising the question of
sustainability in many cases. Loss of jobs would naturally be a direct and most painful
consequence of the current situation.

With a view to mitigating the impact of the lockdown on economic activity, while
aggressively pursuing means to contain the spread of the virus, the Government of India
has started relaxing norms for resumption of economic activity. The Ministry of Home
Affairs (MHA) released detailed guidelines for restarting of business operations in
certain segments in conjunction with adoption of comprehensive health and safely
protocol on 15th April 2020. The guidelines covered all essential goods and services
and also provided flexibility to resume operations even in certain non-essential items.
These measures are indeed a positive step towards keeping business operations going
on a relatively stable footing and minimising contraction of economic activity.

The MHA guidelines are comprehensive, and when implemented effectively by states,
they could help in a significant revival of industrial activity without compromising on the
fight against the pandemic.

The present survey attempts to assess the on-ground effectiveness of the MHA
guidelines and identify the areas requiring attention. The survey provides a holistic
overview as the respondents are from across sectors, states and scales.

II. SURVEY FINDINGS

The survey focusses on various areas which impact the resumption of industrial activity,
availability of labour and inputs, and implementation of health and safety measures. The
findings indicate the business sentiments and priorities for policymakers to create a
conducive business climate for industries, as companies battle the unprecedented
disruptions to daily operations and finance activities brought on by the coronavirus.

©Confederation of Indian Industry 1

1. Question:

Are the guidelines on operational zones in rural and urban areas clearly
communicated by state and district administrations?

No, 11%
Incomplete,
4%

Partially, Yes, 57%

28%

o 57% respondents reaffirmed that the guidelines on operational zones in rural and
urban areas are clearly communicated by the government authorities, whereas
28% said it was partially communicated. This indicates that a majority of the
businesses do not face ambiguity or disconnect with guidelines issued by the
government.

2. Question:
Are permits to operate easily available for sectors allowed to function?

Not
applicable,
12%
Not Provided, Yes, 41%
19%

Delayed, 27%

o 41% respondents claimed that attaining permits for sectors allowed to function
was a smooth process whereas 27% said they faced delays. Only 19% said that
the permits are not easily provided.
o To improve the performance further, State governments should ensure that
permits are granted in time. Permits may be granted on a self-certification basis.

©Confederation of Indian Industry 2

3. Question:
Are passes for workers and employees readily provided to units that are
allowed to function?

Not
applicable
21%
Yes
36%

Not Provided
21%
Delayed
21%

o Only 36% of the respondents stated that passes were readily provided for the
movement of workers / employees of functional units. 21% of the businesses
stated that passes were being provided on a delayed basis and another 21%
stated the passes were not being provided at all.
o The survey results indicate the need to develop a more robust mechanism for
issuing passes to the employees and workers of operational businesses. It would
help if employers issued the passes to their employees.

4. Question
Is the movement of inputs and finished goods for your plant taking place as
required?

Not Yes
applicable 15%
23%

Not available Delayed

23% 39%

o As many as 39% of respondents claimed that there was disruption and delay in
movement of inputs and finished goods for operations, whereas 23% stated that
materials were not available at all. Only 15% businesses in the sample felt that the
movement of goods was timely.
©Confederation of Indian Industry 3
 o The survey results clearly project the need to put in greater effort in ensuring
smooth movement of transport carrying raw materials and finished goods.

5. Question
Is the transportation of employees / workers to workstation and back home an
issue?

Not
applicable
16% Yes
31%

Not at all
17%

Somewhat
36%

o A majority (36%) of the survey responses indicated that some issues were being
faced in the daily movement of employees while 31% said that it was an issue for
their respective firms.
o The survey responses indicate the need to facilitate daily commute of employees
without any hurdles on a priority basis. Among various measures, the government
should specify the guidelines for individual vehicles (4-Wheeler, 2-Wheeler and
Bicycle) for commuting between the residence and factory.

6. Question
In case your business is not operating, please tick which of the following
reasons is most applicable.
Business is in red
Multiple reasons, zone/containment
23% zone, 16%

Lack of capacity to
implement health
& safety protocol, Business is in
1% municipal area,
Fear of possible
Coronavirus cases 20%
in the premises,
4%
Inputs and raw Workers are not
materials are not available/not able
available, 10% to travel to
workplace, 26%

©Confederation of Indian Industry 4

 o As many as 26% of respondents claimed that due to the problems posed in the
daily commute of employees, business operations are suffering, and the second
highest percentage of 23% indicates that there are multiple bottlenecks in the
functioning of businesses.
o The next two most common obstacles in initiating businesses pertain to the
containment classification with 20% respondents unable to start working because
they are in municipal area and 16% being in the red zone/containment zone.
o Some other contributing factors include the lack of inputs and raw materials with
10% responses, fear of possible coronavirus cases in the premises with 4%
responses and lack of capacity to implement health and safety protocols with 1%
responses.

7. Question
Is there a fear that if positive cases are found in your premises, despite
implementing all safety protocols, it could invite criminal case against the
business?

Not applicable,
5%

Somewhat,
Yes, 39%
29%

No, 27%

o As many as 39% respondents claimed that they could be booked under

criminal charges if any COVID-19 positive case is found in their premises
whereas 29% of respondents had a perception that such a possibility may or
may not be plausible.

o 27% businessmen in the sample felt that there was no such possibility and
did not fear any criminal charges.

o While penal action against company are attached only in case of laxity in
implementation of health protocols which may result in worker/s’s being found
COVID-19 positive, there is a need to create awareness among industry
members as well as implementing authorities.

©Confederation of Indian Industry 5

8. Question
What is the present plant capacity utilisation of the firm?

Not
applicable,
17% 0%%, 29%
More than
50%, 10%

25-50%, 14%

0-25%, 30%

o 29% firms witnessed nil capacity utilization and another 30% had it in the range of
0-25%. Only 10% plants are being utilised more than 50% of their full capacity,
whereas 14% businesses have a plant utilisation of 25-50%.
o The survey results clearly project that most of the firms are unable to fully leverage
their plant capacity due to the lockdown restrictions.

9. Question
What is the present employee strength of the firm?

Not applicable,
15% 0%, 20%

More than
50%, 9%

25-50%, 17%
0-25%, 38%

o As many as 38% of respondents claimed that their employee strength was in the
range of 0-25% and 17% stated that their employment strength is between 25-
50%.
o Only 9% businessmen had an employment strength of more than 50% and 20%
respondents had 0% workforce employed.
o The survey results indicate that following the social distancing norms, most firms
had drastically reduced their employment strength and were running the firm with
limited staff availability.

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©Confederation of Indian Industry 6