Retailers in India seek wage support of at least 50% from Finance Minister
Nearly 7 crore traders nationwide led by the Confederation of All India Traders (CAIT) Thursday have seeked intervention of India’s Prime Minister Narendra Modi government to provide salary support of at least 50 percent to pay wages to 40 crore employees as the business gets impacted by COVID-19 pandemic.
Without the support the country’s retail trade sector could potentially be staring at a salary cut as the lockdown continues till 14th April 2020, as per the latest update. The major concern is that it may also eventually lead to massive job cuts to lessen the financial burden. Praveen Khandelwal, Secretary-General of CAIT shared with ET, “We have asked the government to provide support on the salary component to the tune of 50 percent. Rest 25 percent will be taken care of by the employer and another 25 percent by the employee.”
With the business shut down because of the lockdown, retailers are now concerned about managing costs. "Once the situation normalises, the traders will have multiple challenges such as commercial rent, statutory payment and business revival which would further make the traders financial condition worse," Khandelwal added.
In the letter addressed to Finance Minister Nirmala Sitharaman and dated April 2, CAIT has mentioned that a strong stimulus package is needed for the small businesses who are the contributors of a major chunk of revenue to the government and are also the backbone of the Indian economy.
In recent years, small businesses were indeed given a lot of focus and identified as a source of creating more job opportunities as well. However, the current crisis looming over the country due to COVID-19 has put all of these jobs in question now. Businesses will be in a dilemma whether to focus on maintaining cash flow or keep the employees financial well-being in mind. How do they find the balance?
Here's an intersesting read on: Keeping cost in check and employees on the payroll amid COVID-19