 We are ready. Hello and welcome everyone to the second edition of SME Virtual Conference by Entrepreneur India and powered by BusinessX.com. Today's discussion will revolve around key factors every SME or MSME needs to keep in mind after resuming business post the lockdown. I am Punita Sabarwal Kapoor, Deputy Editor Entrepreneur India, your host for the session. While it is only natural to expect a tough future in terms of business after the COVID-19 lockdown, it is not an impossible difficult situation to tide over as many believe. When the going gets tough, the tough gets going. If anything, the lockdown can help us learn important business lessons that can help us not only survive but also thrive. Let me start by laying out the ground rules for our attendees. The discussion will go on for 40 minutes. This will be followed by Q&A session for 20 minutes. If you have any questions during the course of the discussion, you can post them through the Q&A option at the bottom of your screen. Mention in your question if it is directed at any specific panelist. We'll take up the question for the panel discussion. We would also like to request all the attendees to keep the question busy. The scope of the discussion here. Let me now introduce our session moderator for the day, Ms. Rithu Maram, the Editor-in-Chief of Ansar Panor India and Asia Pacific. Our panelists today are Dr. Arun Singh, Chief Economist, Dunn and Bredstreet India, Akash Kehani, COO and Co-Founder, Insta Mojo, Mr. Aditya Perliya, Co-Founder and Pro-Chancellor of the APJ Asfathya University and JMMCII's Delhi State Council. Ms. Hetal Gandhi, Director of Crystal Research, Mr. Pranav Bhai, Founding Partner, 314 Capitals and Ms. Sandeep Chhetri, COO, Trade India. I would now request Ms. Mara to start the session. Over to you, Ms. Mara. Thank you very much, Venita. A very good morning to all of you and thank you for the panelists for joining us. MSME sessions, you know, conglomeration meets we have put together largely to help and help forward, help put forward for the MSME sector to decide as to how they should be planning their business in the next one quarter to two quarters. So just to sort of give an overview of what the sector looks like to understand, which is important to address and how big it is, I've just taken up some figures. So today, in an MSME sector roughly accounts for about 117 million people in terms of employment, about 45% of the total export trade of India contributing to 30% of GDP of India in which about 6.6% is manufacturing and about 24.6% is services. And it also contributes to about 45% of the total industrial input. So we're talking about a large sector of India, which is going to be severely impacted once we are really going to unlock the lockdown of COVID. Now, how big this impact is going to be and what is it that MSMEs today need to be prepared in order to make sure that impact is reduced is what we're going to sort of discuss today amongst all the panelists over here. So we have a great panel today, very accomplished people who've done a lot of research and have a great big understanding of what is it that MSMEs should do to reduce their stress in the coming one month. So let me start with the economists in the house. We have Dr. Arun Singh from Dun and Brad Street. Dr. Arun Singh, my question to you would be, what is your assessment of the entrepreneurs and MSMEs? What is what is their first thing or the first few things that they're going to be suffering from? And what do you think they should do in order to reduce the impact of that? Yeah, thank you. So I was just looking at some of the data and facts. If you see in India, we have something around 81 million economic entities and out of 81 economic entities, these are the basically the big group companies as well as the street vendor on various streets. Basically, 81 million entities involve everyone. Out of 27 million entities, basically what we call economic entities, they are basically employing at least one labor and are operating from a permanent establishment. Pretty much 99% of that will be MSMEs because just less than 1% is a large company. Hardly, as per the new definition, there are hardly 67,000 large companies you can put together. That's one thing. When I look at this 27 million economic entities, 94% of the economic entities, what we call MSME, they're basically an organized sector. And out of that 68%, unfortunately, they don't have any digital penetration, which means the lockdown period, they're going to have a completely down their operation. Very, very few company will have operating or doing some job or doing some activity was there basically supposed to be doing. So in that scenario, they only trouble. In fact, they're trouble from a finance perspective, they're trouble from the demand perspective, they're trouble from the labor perspective. And for most of the economic entity, staying shut for more than a one month is going to be a serious trouble, going to be a massive problem. Now, many things they can do. I mean, over time, we can talk about a lot of stuff from a government side, as well as from their own side, which basically keep them, you know, afloat in terms of during this credit comes during this financial problem during this lockdown issue. One, the all the entities basically who are operating at this point of time that basically there are 68 to 70% of the economic entities, especially in the manufacturing sector, they're not going to do. I mean, it's not possible for them to basically start and talking about the company who are basically are operating, have some sort of digital penetration, some digital channel and they're doing their working. And at least they can help themselves at this point of time. One, look at your balance of risk, basically, during the economic prosperity, many times what we see the, you know, upside out with things we normally ignore, that we have to look at, reassess your company's credit policies and recalibrate the portfolio risk profile for new and existing customer. That's basically, you know, balance of risk approach. Second thing's very critical at this point of time is that consider a supply chain data. When I say that, now, you know, the month of February, when we started and when we started looking at impact of COVID-19, that time we said it's a supply disruption. Most of the company not going to get that input at the time, you know, during the time of crisis, but unfortunately, that supply disruption is transforming to a liquidity or demand problem, which means even if you're locked down, withdrawn, COVID-19 stabilized, they will have a major demand problem. Before that, I think we need to look at their supply chain data, basically their suppliers, suppliers, the customer's customer, how they are trending. Second thing, a third thing is that set the proper credit limit. And the fourth appropriate terms, when I say, basically, when you talk about your customer, whether you want to give one month credit, two months credit, that you need to seriously think about recalibrate that. What we have done, we found the DSO of most of the companies, especially the MSMEs and the large company. Unfortunately, MSME, especially the micro and the small, they struggle to get their payment on time, especially from the large company. Most of the company, they differ beyond 90 days. And now they have a full reason to differ further. So that they need to watch what basically they are going to get the AR and of course, the payable to their customer, that needs to be monitored carefully. Then there has to be active portfolio management. The very critical part at this point of time is that look at your five C of credit, what we basically, it's like bread and butter, which most of the company normally tend to ignore during time of economic boom. That's basically five C is a corrector, capacity, capital, condition and collateral. Basically, not just with your vendor, also with your customer and with basically your financial and the bank, that needs to be re-looked. The plus point here in India, I think I should call out this, that you know, fortunately, I mean, from economic crisis perspective, the COVID-19 is not an economic crisis. This is an external shock. This is not a part of economic crisis. For any economic crisis, it takes a severe time. It takes too much of time to recover. You go back to 1929 economic, the Great Depression, that it took almost 22 years to recover. Even the most recent 2008 financial crisis that took five years to recover. But fortunately, the COVID-19 is not economic crisis. This is external shock. The silver line here, I was just talking to other panelists earlier that the silver lining here, that we have seen economic green shoot in month of December 2019 and early days of December 2020. That's one thing. Second thing is that COVID-19 is not economic cycle. The moment it controlled, come to the normal moment, locked on withdrawn. The economic recovery for India will be much faster than any other economy. It's basically the need of our that follow this basic principle and look at your the 56 ask from the what basically we see MSME can do and do your basic check-in. And I think things will be normal once, you know, once economic recovery starts of COVID-19 control. Sure. Thanks, Dr Singh, for that. You know, let me come to you, Aditya. So, you know, obviously that you're also the while you're running a big educational conglomerate. But at the same time, you're also the chairperson of CII. Now, my question to you is, what are the issues that you are facing in, you know, what are the issues that are related to MSMEs today in terms of labor shortages in terms of supply chain issues, which also Dr Singh has related to, and also consumer demand coming back. You know, my question really is that if you see what is the contribution of MSMEs to GDP, the bigger percentage of contribution comes from services rather than manufacturing. And services itself looks like it's going to be very staggered when it comes to its recovery. And with, you know, which also means that the big hit is actually going to be on the services. And therefore, the contribution to GDP is only going to be reduced, whether it is retail, whether it's food services, everything looks more staggered than manufacturing today. So how do you, you know, as a head of CII, how are you looking at the situation and what kind of fiscal stimulus is it that you want from the government or is it that it is being demanded? So I mean, of course, government giving not giving is a separate issue. But what is it that MSMEs are demanding in order to come back faster? So let me put this in context, you know, India hasn't really had an economic economic crisis this widespread. If you really look at, you know, 2008 India pretty much skipped that for the most part, if you look at the because more of a global crisis that arrived on India shore rather than and then then something that was really experienced down to the last man in India, even sort of 1999 2000.com bust, lot of pain, but definitely not something like, you know, what we're seeing today. I think you'll have to reach back to maybe, you know, 1990, before India embarked on its great reform period to really see such a widespread and deep crisis that is impacting every single sector. And one of the big things that we've seen is that nobody's winning here. You know, a lot of people are thinking, Oh, pharma companies will do well, they're not hospitals will do well, they're not every, you know, the guys who make mass hand sanitizers will do well, they're not on that internet companies will suddenly do well, maybe a little bit, but that advertisement has dried up. So not really. So it is a widespread and deep crisis. The good news is that there are a couple of big trends that are happening in the world. You know, the US has taken out almost a $2 trillion and now increasing the package, you have half a billion plus in most places in Europe coming online. And you have to understand this is no strings attached money. This is not something that they have to put into their economies. It is pretty much printing money and sending it out. This means that you're going to have a lot of yield seeking people. And if you really look at the options, six months, nine months down the line, if somebody wants a three, four, five percent return, US is not going to offer it for sure. Europe is pretty much is in a slow decline right now. They're going to take a year or two years before they get up and running. UK is a little bit of a bright spot there. And I think in the emerging markets, no one's going to touch China for at least a year until the data settles. Latam is going through its own issues. Russia again. And so if you really want yield, India is pretty much what's going to happen. And so in six to nine months, you're going to see this wall of money, which is going to come in. It's going to buy on the Indian stock market. It's going to start sending a lot of funding into NBFC. It's going to bring a lot of external cash into the system. Now, there is a long time for an SME to survive between now and six months and nine months. And I think that is the critical period, what you really have to watch for is how do we get the maximum number of companies to be able to hang on for six to nine months? The advice I've been giving all SMEs has a very simple combination. The first is they need to take hard decisions today. And SMEs are not used to doing that as much because chips are up, chips are down. They're very used to figuring out the business cycles. They're not used to, they haven't experienced an existential crisis the way they're doing right now. So they're not prepared mentally to take the hard emotional decisions that, let's say, a more strict or less compassionate company internationally might be able to do so. The second big issue what we see with SMEs is that they already came into this crisis with a lot of debt. And so all the solutions that we are seeing that are coming out and circulating, and I won't name names or ministries or etc., but they all involve SMEs ticking on more and more and more debt. And a lot of this is not uncollateralized debt. So they're giving personal guarantees to secure their debt. And that's just kicking the problem down the street. There's been no tax relief so far. Many other countries, France, UK, US, all have done amazing things to buy on salary, wages, taxation, payments, loan stuff. India hasn't been able to do that. And we don't have quite frankly, and I don't bring the government for this. We just don't have the fiscal room to even do it. So right now what we are asking is that, look, if you can't have a massive stimulus package or a massive SME cash injection package, at least start to look at major, major structural reforms across the country. We are very happy that India and the ease of doing business is now going to be probably in the 60s or 70s. But really is that something to celebrate 60s and 70s? If you were to put that on a report card, that's not a very great number to talk about. And some of our ranks are terrible. Contract enforcement is 160 plus. And so I think what SMEs really need now is a massive, massive cutting down of red tape because they can't deal with extreme regulations, inspections, tax issues, TCS, GSTs. We calculated that and SMEs who are trying to become an MSME and have a pan India present requires 1,135 GST returns a year minimum. And so now is the time I think the government really, really has to take structural, structural reform. I think our leadership in the government has shown they can do this. If they can do demonetization, they can take very hard calls. And this crisis is an excellent time. There's a whole slew of reforms that were on their cards before. And I think what we are saying that, look, now is a great time to put them out. It will really improve perception and confidence in the economy. And a lot of MSMEs who are stuck will at least be able to start moving again. And the last point on this, I think, look, I think we all have to sort of understand that we are going to see massive job losses. We are going to see a huge amount of hurt for the next six months. A lot of SMEs, the best decision they could make today is to close shop and wait it out for a year and then reopen once the economy is in a better place rather than digging themselves into a whole of debt, debt, debt, debt, ruining the credit rating, declaring bankruptcy, going through the IPC process and all of that. So I think there is something to be said for that. And I think I'm so glad we are in 2020 and a lot of the stuff happened to allow in effect. The biggest thing I'm worried about, however, is that some politicians and ministers have started talking about this, but we haven't really seen any publicly announced action. And some of this is confidential, so I won't go into it. But we are going to see a massive, massive systemic wide crisis post the lockdown ends, which is going to freeze everything from the judiciary because the number of court cases around premature firings, around force majeure, around supplies being stocked, demure age is going to flood the system. We are going to see a huge amount of issues that are going to come out in terms of non-payment abuse, bank loans, NPAs, all of that, which is going to flood the system. We are going to see a lot of trade stuff. Right now, even companies which are open because banks can't handle original documentation, they can't do LCN trading. And that's insane. Factories are open, shipments are ready, buyers abroad are willing to buy, but because they can't get their banking documentation done, they never did the trade reform really that was required in the last 10 years. So you have those major issues that are coming up and there's going to be a one-time cleanup for the next six months, nine months to really get the economy going. And the focus, in my opinion, needs to go structural reforms. RBI reducing its cut by X percentage points is very nice for large players. MSMEs do not see that money. The MCLR rate is still 7% plus and no bank is dispersing anything except token amounts to their existing borrowers. So we do need a structural reform solution. Putting people into more and more depth isn't the right answer. Sure. Thanks so much for that, Aditya. Now, let me come down to Akash. Akash, I'm going to get into the micro of things with you. And for understandably, for MSME business, their total sort of cash flow standing is nothing more than about 30 days at the maximum, wherein if they don't get cash in, they are going to get into some serious business crisis when it comes to making their pay, their vendors are paying whatsoever. And the downside with SMBs is also that, you know, unfortunately, their vendors are large and they are small, which is a reverse when it comes to large corporate because their vendors are typically small, their ancillaries are small. So they can give off the payments or defer the payments. But in case of a small and medium business, the large companies are going to muscle them out in terms of taking their payments. So how is it, you know, that they are going to meet their cash flow requirements, which are so important for them in order to get the business going? As it is, we are always working on a restricted or a negative kind of a working capital. So how do you see these things or how do you see the situation becoming okay for them? So I think this has always been a challenge with the smaller businesses in terms of, you know, how they are able to, you know, in terms of due payments on time, right? And no matter how big a business you're dealing with, in fact, the bigger they are, the worse they are when it comes to payment terms. So this has always been a challenge and this has further God, you know, access abated now. So I don't think there is any solution that can really come out of it. What a lot of businesses that we've seen, you know, do and I think which is thankfully just also, you know, working on pretty well in the broader ecosystem is that you can go to your own vendors, the ones that you have to pay, right? For whatever reason, that is, it could be rent payments, it could be salaries, it could be a lot of other things. And you're able to either negotiate them down. And we've seen that work very well. I've spoken to a lot of companies out there who tried to, you know, reduce their negotiate with their landlords in terms of the rents they pay. In many cases, the landlords have been kind enough to follow the rents for an entire month, right? Like April, for example, has been a lockdown month across the country. So that has worked. I think you have to look at outside the box for it, you will have issues in terms of how you're able to collect money from your customers. But at the same time, you have to, you know, also look at the further upstream payments that you have to make. The other thing that we've, you know, we've been seeing is there has been, like you said, right, a working capital financing is one of the critical things that MSME needs. A loan, a loan, you know, which helps you grow your business over the next 12-odd months isn't something that is easy to come by, isn't something that also solves a lot of problems for them. And in these times, what is more important for them is the shorter term periods, right? Can I get a loan for 30-odd days? Can I get a purchased order based, based, you know, baseline of credit? So some of these things I think are starting to open up, they will open up, right? Because even the NVFCs and others have been out of business, right? For a good, you know, a few weeks now and this is going to continue for another, let's say a few weeks, right? So when things start opening up, maybe around June or so, a lot of these options would be on the table. So I think it's all about surviving during this time, managing with whatever cash you have on hand and trying to conserve that as much as possible and being able to, because everyone is out there hungry for business. And I think there has been a bit of talk of, you know, that there is a demand-side problem or a supply-side problem. I think the bigger problem a few months later is going to be on the demand side. We've already been seeing over the last year or two to three quarters, that demand has been slowing down. So while right now, it's more of a supply-based problem, but things are going to change, right? Because every business out there will be hungry right from banks to NVFCs to every other business, right? So I think the bigger challenge is going to be demand-side because the consumer sentiment is really going to be low, you know, a couple of quarters down the line. So yeah, I think that's that's how the businesses will have to manage. Sure. Thanks, Akash. Let me come to you, Pranav. Now, as you know, of course, Akash has pointed out that working capital would be a need. Capital itself, I mean, you know, would be a need. So I at least at this point of time, I'm not even seeing, you know, a bent of mind for MSMEs to look at innovation and to look at a bent towards probably, you know, bringing any kind of technology improvements or structural improvements within the organization. Right now, it's more about survival for sustainability. So, you know, I mean, do you feel, how do you think we can bring more finance, more capital into the economy for MSMEs? Do you see venture debt now becoming more important than what it has been in India so far? Do you feel NVFCs and these small funding startups now becoming playing a bigger role than what they have played so far? More fintech lending, more fintech funding coming into the system for the help of MSMEs? Yeah, that's a good question. So the way we see it, I think we'll see it in three ways. On the monetary side, I don't think there's a liquidity issue at the very highest levels in the country today. Just like Aditya also mentioned, the government's been very proactive. The RBI has announced what it normally takes a dozen four years in three weeks. So that's a fantastic set of announcements. I think at the very highest level when it comes to liquidity, the government has done everything it needed to for the first part, of course, there are many more parts required for the first part to make sure there's liquidity at the top. Unfortunately, MSMEs are amongst always the last to benefit from any monetary policy. And that's a fundamental lack of transmission of benefit in this country. There is far too much friction from the top to the bottom. And today's bottom are no longer the below poverty line people because they're the first to get saved and get relief. There was a 1.7 crore of 7 lakh crore relief package announced for them. This is a country that takes care of its people. It is not a country that has learned how to take care of its businesses yet. So that's a fundamental issue. And that's why monetary policy, no matter how many more announcements the RBI makes on cutting rates and flushing the system with liquidity, I don't think that's going to help MSMEs at all. And that is why I don't think debt is going to be the final solution for all the capital constraints that MSMEs face today. And the three basic issues that until we fix, that's why I don't see debt being a fundamental permanent solution. The first issue I see is this friction in transmission. Every country in the world has developed has learned to empower business and remove all friction for businesses to scale using local capital. Unfortunately, in India, the way our regulations and our bureaucracies work in every single system you're in, whether you're in industry, whether you're in services, whether you're trying to pay your taxes, whether you're trying to get some labor ease out of labor controls for your industry. In every single aspect of running your business, there are in fact more and more friction points being added every year. So when you look at just how policy and regulation is framed, it does not seem like this country at the government level at least has understood how to ease out friction for business. Until we take a principle stance as a country that business is important, business builds the fundamentals of our economy, our national economic interests are secured by strong local Indian businesses. Until that principle stance is taken, I don't see any of these things being fixed. So it's while again, while we can say the RBI has to do many things until we fix these friction points, anything the RBI does doesn't matter for MSMEs. The second big point around debt is that again, when it comes to the method of lending, India's still a very primitive asset based lending environment. We don't do cash flow based lending. And that's very important for MSMEs because they don't a majority of them are not very large businesses. They don't build large asset bases that early in their life. And the earliest part of your of your life cycle is amongst always the hardest as as Akash can also state, he runs a startup, he knows exactly how hard it is in the early stages to get capital. So we think that again, if you don't make that principle change to making sure that even the way you lend moves from asset based to cash flow based, and our banks are sophisticated, they use amongst the strongest technology stacks in the world. Indian court banking is used globally now JP Morgan shares, DBS in Singapore, all the top banks in the world use our software. It's it's completely ununderstandable for me why we haven't moved on to a new paradigm. It's not a new paradigm. It's a very old paradigm cash flow based lending, but we still haven't gotten there. So that's why even if we did open the floodgates for debt for MSMEs, I think the method with which we use to lend out to the MSMEs unless that changes, it's not going to make a material difference. And the third thing, and a fundamental lack of fiscal policy here is what matters is even if we figured out how to do debt, the sheer rate of taxation is in this country so high for small business, that is it is they are almost always going to be unable to service that debt meaningfully until they get to a certain scale. So they're always stuck in a trap. I'm too small. It's too expensive. I'm not able to grow big and I'm not able to get more funding because I'm not big enough. I don't qualify for all these things that the banks require of. So we're always stuck in this this trap of size. And historically in India, that's been the trap that most businesses fall into. So the only businesses we've seen really scale out, think about it, the three types of businesses that are businesses that utilize licenses to their advantage. This is I'm talking about the 60s and 70s in the last conglomerates that came out of those decades. Number two, there are businesses that came out of nowhere. The IT industry is a big example. No one understood what IT was. They didn't understand how to tax software. It doesn't exist in the real world. How do you how do you frame a policy for taxing these services? So they came out of nowhere and because they didn't have much friction to scale, they became large. And the third type of companies that have grown large are companies that, for example, today in startups, have nothing to do with physical geographical limitations. Again, it's a derivative of point two, but they've managed to scale in a way that other MSMEs cannot. So until we see a lot of changes, we think debt is not a final solution. Coming to venture debt, I also fundamentally believe, while I think venture debt is very important, I don't think venture debt is going to solve the crisis that the crisis, the plural, that MSMEs will face once we come out of lockdown. For example, venture debt is extremely selective about which balance sheets it considers viable before it lends you a line. And venture debt almost always has an equity kicker. I promise you, no venture debt fund wants an equity in a business that is not able to get its laborers back, that is not able to give you a firm commitment on what revenue looks like three months from now, is not able to tell you for sure if its GST refunds are even expected to come back this financial year. So there are far too many hurdles and far too many constraints for a regular MSME to be able to be able to qualify for something as sophisticated as venture debt. While I think VD is important, I don't think it's going to be a solution for the immediate crisis the MSMEs are facing. So I can go on and on about a lot of these issues. We've studied and published a lot of content on these issues and on policy that might help solve these issues, but I'll stop there and obviously summarize by saying that it's a long difficult path ahead. A lot of reform is needed for us to take adequate steps forward and really help ensure our MSMEs are able to take a step forward and protect this country's national economy. Sure, thanks for that. I mean, just to sort of add on to what you just said, do you think that yesterday's big news about Geo and Facebook coming together is going to percolate to SMBs in the coming times and how do you see that happening? I think it will to a large extent. Geo is committed to making sure that not just consumers, but small business is also a core part of the platform they're building. So the three parts of that platform, there's the end consumer, you and me individually, there's a small and medium sized business, and then there's the enterprise, the Hindustan Unilever and the large companies that are producers of all the goods we consume today. So they want to build the platform end to end. It'll have retail, it'll have data, it'll have analytics, it'll have digital infrastructure, it'll have a number of layers. So I think it's a good move. Unfortunately, again, I don't think a Geo-like platform is going to help solve the immediate problems MSMEs are facing. They need liquidity, they need access to lower taxes, they need simpler ways to stay compliant with the volumes of legislation and regulation in this country today. So while Geo will make the world full of less friction, I think immediately again MSMEs will be in the bottom of that stack to benefit. So in every stack we're trying to fix, the MSMEs are always at the bottom and the last to get the benefit. I don't think the MSMEs will get too much help from anyone picking up any time soon. Sure. Thank you. So let me come to you, Hital. At Prissel, you do a lot of research and I understand that today you probably look at sector to sector growth and sector to sector changes that are going to happen. So what according to you are the sectors where you see this sort of bounce back happening very quickly and then what are the staggered sectors, what sectors are going to take a long time. And just to add to it, while we are opening up the country in a staggered way, so from there my chances see it, I feel that it might not help the industry too much. I mean, if one industry is open and its ancillary industry is not open, that particular industry is never going to benefit. So it's open and its ancillaries are not open either due to a state problem or due to a containment problem. How do you see the industry cycle being sort of coming back and finding its wheels? Yeah. So I think, yes, I think all of us know that, you know, which are the sectors which are most impacted. In fact, if you look at a portfolio of around 65-70 sectors that comprise of MSMEs, almost 75-80% of them will be very sharply impacted right now. We clearly believe that, however, these sectors would follow U shaped or V shaped recovery depending upon, you know, how the dynamics emerge. Here, it is very clear that the recovery will be more pronounced for anything that is more food related. So any of your food processing sectors, your agriculture related sectors are the ones which are going to see a V shaped recovery. There will be pain in the interim as the pain subsides and as normalcy returns in terms of lockdowns being removed, myths being corrected over a period of time, these will start showing, you know, V shaped recovery. So the likes of whether it is a Dal milling or these processing where a large proportion of the demand is B2B, or whether it is, you know, sectors like sugar where today you are seeing a sudden very high supply of blood that's happening. All of these sectors will start seeing correction as the demand starts reviving and the revival of the food will be more on the consumption side, which is non-discretionary in nature. So you will see a V shaped recovery in these sectors which are having a linkage with consumption but is in the discretionary category. So that would lead, you know, have the entire auto space. It will have hotels, media and entertainment. All of this is going to see an elongated V shaped recovery. It will take a lot of time to recover and within that you will clearly see that MSMEs will be much more impacted than the larger integrated guys. You also asked the second part of the question that, you know, how do we allow to take advantage of the opportunity later and, you know, should we avoid not opening up specific sectors, etc. I believe that there are a lot of structural flaws also that we need to focus upon and each of these stakeholders need to play their important role. For example, you know, there were a panelist who spoke about shifting to cash flow based lending patterns. Today we have in fact a large proportion of the MSME lending which is nothing else but a collateral lab based lending. You also are looking at a scenario where, you know, if you look at the debt equity ratio of MSMEs who have gone for financing. So with the 19 trillion or 18 trillion worth of NBFC debt outstanding to MSME, it's hardly anything of the total MSME funding requirements. So what we found is that, you know, a large proportion of the MSME portfolio is funded by means which are not in nature, right? So then, you know, and the debt equity ratio of the companies is extremely low, right? So it's not that they are very having stretched balance sheets. So how is it that these people are actually funding? They are either bringing up loans from family members or which are, you know, inter-cooperated loans or they are pumping in their own money. Now, you know, structurally, MSMEs will need to invest to ensure that they are improving their competitiveness in terms of getting more official finance as they want to scale up their business structurally. They also need to take help of stakeholders to ensure that they are bringing about changes in terms of the way competitiveness and enhancing. So your logistics index. So today, if oil prices are half, but a large proportion of that oil benefit is not going to be transferred at the retail level, at the end of the day, it is going to somewhere impact my logistics capabilities, my logistics cost. So how are you taking care of that? That is also going to be equally important. Each stakeholder will need to pay up that rule. That is the easy answer in an immediate basis. I don't see that given the risk awareness that lenders are into, there is going to be any easy access of finance that is going to be possible. Right now, there will have to be a combination of bringing in your own funds plus also ensuring that you are taking some bold corrective actions in your businesses to maintain sustainability. Once you get out of the rut, you will have to invest on structural issues to ensure that when the next downturn comes, you are much better prepared to get access to finance than any other. Yeah, well, thanks. But let's not wait for another downturn to come because let's first get out of this one only. So, let me come. Thank you, Hazel. So let me come down to Sandeep. Sandeep, at Great India, you probably have a whole host of different kinds of MSMEs which are listed in the platform. Now, what are the pains and what are sort of the areas where the MSMEs want your help? I mean, particularly from a trading perspective, where do you see their challenges today? What is it that they would want to address first in order to be able to sort of bounce back faster? So, already most of the panelists have talked about one of the pain areas that is credit and cash flow, which is one of the biggest pain area right now. But how we see, as we work very closely with the MSMEs, so there are small MSMEs, there are medium MSMEs, and there are a little bit larger enterprise in the MSMEs itself. So, all the MSMEs have different challenges. But primarily one, of course, the challenge which they are right now facing is the cash flow challenge. Second, what they're looking at is the demand because of the lockdown and so many factories and companies manufacturing closing down, there are challenges of raw materials and all those things. So, now they feel that even how to continue the business, that is one biggest challenge which is there for them and how they can cope with this continuity of business going forward as well. So, we see lots of MSMEs coming to us and saying that, you know, talking about how they can digitize the whole business, the whole operations and all so that they are prepared for going forward, you know, primarily, and they're looking this time frame as the harvesting time where they can, you know, fix those issues primarily, okay. And they're also looking at low-cost technology or transformation, you know, for the business. So, that is one area where we see lots of MSMEs coming to us and we are also closely working with them to, you know, build those technologies and giving them online tools to help them run the business at this moment. One more, you know, I mean, questions they're asking is how they can transit, you know, transition of the business to other categories, okay, primarily and coming up with, you know, asking us more questions on how, which are the categories which are doing really good and, you know, where they can be, where they see the synergy in what they are doing currently. So, I'd like to give an example, like, for example, so the non-woven fabric companies are coming to us and saying that, what is the demand of non-woven masks and all, okay, or PPE kits? So, there's huge demand on the platform itself where, you know, we see lots of demands coming from pharmaceuticals or non-woven fabric masks and all. So, they are doing transition, you know, transition their business from the actual business to that particular business to sustain right now, okay. So, that kind of transition we can see a lot, seeing a lot and also in terms of manufacturing, what they're looking at is, you know, on localizing the whole supply chains because supply chain has become a very big task for them currently. So, they are looking at in future, how can they demand can be generated locally and it can be consumed locally, you know, that is what they are looking at to be future ready, okay. So, these are the things which the SMEs are looking at currently, you know, the online tools and the digital transformation, credit and of course, you know, optimizing their business right now using technology. Ritu, are you there? I think maybe so. Okay. So, till the time we get back, maybe it's due to the internet connection, we can start with the question and answers. Can I please ask the operations team to give audio to our first attendee, Surva. Dropped out from back right now. Okay. You know, thank you, Sandeep. I lost you there for a woman. So, you know, there was one point that was made by Pradhan earlier, which was to say that we needed to sort of fix our taxes. So, what, when you say fix our taxes, what's exactly or what reforms within the taxation is that you are looking at? And I mean, this is to Pranav and to Aditya both. Would you see a pure reduction of the percentage or do you feel that it should be symptomatic of the income levels on which are the balance sheet of the MSME? Yeah, I can take the first part. So, let's look at how tax collection works in India because very interesting numbers. There are only 5 crore people in India out of a population of 137 crore that file income tax returns every year. Out of these 5 crore, only 3 crore pay any tax. So, 2.4% 24 out of every 1000 people in India support the income tax collection of the country. And the income tax department, the CBDT has a target of collecting 5.6 lakh crores, which is 2.73% of India's GDP. That was a target for this financial year, the financial year we just entered. So, this is an extraordinary country because there is such a small sliver of the population that supports the entire tax base of 137 crore people. And the majority of that tax base are actually business tax filers, including GST, including service taxes and so on. So, there's actually, in terms of an income tax burden, a country like India with such a small section of people paying tax, instead of making it easier for them to comply, instead of making it easier for them to grow their business so that their net contribution to taxes can scale over time, which is what every developed economy does. It seems to be getting harder and harder every year for any business to scale, anyone's income to climb. And for that matter, for us to be able to collect taxes with less friction. So, every year is getting harder and harder for people to stay compliant. And every year is getting harder and harder for people to grow their base of revenue and income so that they can pay more taxes. So, the whole philosophy of the country is twisted. And that's the first thing that, like I said, that needs to be fixed. But for immediate solutions now, instead of philosophical debates that take decades, I think there are three things that we can do for sure. Number one is there has been far too much time since the last GST refund happened at scale. The first thing the government needs to do is give back everyone's IT and GST refunds because that's money that's owed to us. That's our money. The longer they hold on to it, the less chances there are of businesses, especially small businesses, surviving in a cash flow current situation like this. So, the first thing this country, this government, this administration can do is this return money back, that is owed back to the businesses, owed back to citizens. The second thing they should consider very seriously, and this would be the first time it's happened, but this is more than anything a time of crisis, it should happen now, is deferred tax payments or deferred immediate TDS that all businesses have to pay every month. Now, it's very important at a time when your revenue is crashed by almost 70, 80, 90% in most cases. If you're still collecting tax, you're still expecting people to file. And remember, the finance minister only announced a deferment of filing debt, not a deferment of payment debt. So, it's a very interesting announcement. I think the administration must immediately waive all tax collection on all people and allow people to hold on to cash. Even if you are doing some business generating some income, it must be essential to allow people to hold on to that cash for as long as possible. And then the third thing, and this is remember, this is the only the third thing, the third thing the administration can do is reduce the rate for this year and make an exemption for one year. It's fine if the CBDT doesn't collect its target this year. This is an extraordinary year. It must prioritize leaving cash with businesses, leaving cash with citizens. I think that's also a good announcement to make. So, remember, none of these three things are anywhere close to what other countries are doing. Other countries are flooding their MSMEs with cash. Other countries are paying businesses to retain people on payroll and give them their income for that month. Other countries are making sure that there are low, almost zero cost loans being made available, 300 to $400 billion at a time. That's that's lakhs and lakhs of crores, just specifically for small businesses to get immediate relief and a cash buffer until when businesses come back. So, we're not even asking for any of those extraordinary situations which are very real and happening in all parts of the world. These are three very fundamental things that can happen with almost no effort immediately to give small businesses relief. But I think we expect it will take a long time for this to happen. So, I mean, I love the question because I'm actually trying to write a book where I think almost 150-200 pages now accidentally got devoted to this subject. So, I'll try to be very brief on this. I could not agree more with Pranav on his point. Let me just walk you to the simple three, four basics. Tax compliance in India is probably one of the worst in the entire world. No, you have, you know, sub-Saharan African countries who do a better job than us. And for no reason, there is no good reason why it should be this way. I think the very first thing what what we need is a complete overhaul of tax policy. And this is not me saying it or Pranav saying it or somebody else saying it. The government has had commission after commission after commission on tax reform. And they've all said the same thing that the system is horribly broken. We need a huge amount of reforms. And here are some very basics that you can do. The first major one is restore trust in the system. Right? How can you trust a system where you're not getting a refunds on time? Right? You have MSMEs and SMEs dying of liquidity and cash crunch. And the government is sitting on the refunds. They give 5 lakh rupees back and everybody is supposed to celebrate. And I think there is somewhere a lack of trust that, hey, if I if I'm an honest taxpayer, I pay my taxes. Do I get my tax refunds on time? Does the government take care of me as a priority? Do I get prioritized over everybody else? And I think that factor of trust has to be restored. And that only happens from action. It cannot happen from words. I think the MSMEs and most industries have heard enough words for the last three, four decades. When they see the action happening on the ground, that's when trust will come back. The second big issue is the complexity of our taxes. Now, I think the finance minister did a wonderful job in trying to now eliminate deductions. They should absolutely eliminate all deductions. Have a fixed rate. If you want to get into very complicated tax planning, let it be the 100, 200, 300 crore plus people. You know, MSMEs have enough to worry about. And now, earlier now, they had GST rolling out three GST numbers per state. God knows how many filings, GST rates, five of them keep changing. It's an abysmal. There is no other country which has gone crazy. And for those people, by the way, who say, oh, how can you have Mercedes Benz and a packet of Maggie be the same GST rate? Then I said, look, on that basis, you should have a different tax rate for a school teacher on income tax and a different tax rate for a tobacco salesman. So that entire notion of industry dependent taxation doesn't wash. Most countries have a zero and a single rate. Countries like the US don't even have service tax, but India does not want to benchmark against the US now because they suddenly realize it doesn't look that well in terms of taxation systems. The third thing, so simplification, there is no reason why we can't have a single GST number. Businesses should be able to say, look, I bought from here. I sold from here. I uploaded my invoice. You figure out how much to go to state, how much to go to center, how much to go to XYZ. Why is that a problem of an MSMNM? It doesn't make any sense. Every other country has a single GST number or a VAT number. You file and what goes to federal, what goes to state, what goes to municipal, that the GSTN organization, which, by the way, has all the states as board members should decide. So the second is massive reform. The third is why is the government today using MSMEs to plan its cash flows? Why are we paying TDS? Why are we paying PCS? Why are we paying advance tax? All this stuff is the government is saying that this is for us to plan the cash flow. You're a sovereign country. You have brilliant economists, great bankers, access to lots of bonds. Why are you telling people to pay advance tax and then penalizing them when they can't predict what their taxation is going to happen at the end of the year? Suddenly, you make a bumper profit at the end of the year. You penalize or you should have paid this to us six months ago, nine months ago. Let the government plan. No other country does it. Companies have to manage their cash flow all there. Government manages its cash flow in a much better way than AMSMEs can do it. And then at the end, what is you? You pay. The last bit is they need to close the loop. This is very important. And this is good for the government because it will dramatically increase tax. The basic inputs that go into any sort of system is not covered. Energy, electricity, internet interventions, all of this stuff is not covered within the gambit of GST. So you're actually not getting the level of input credit that you actually have. So when that happens, and I won't bore everybody with the calculations, but an 18 or a 28% GST effectively becomes a tax on profits for most AMSMEs and AMSMEs who are selling to the consumer. And our internal calculations when we did this is about the average AMSME plays about 63% to 70% in taxes by the time the money comes to them after they've dealt with the first range of taxes, then GSTs, then value added, then lack of input credit on all of this, then the dividend taxes, then by the time it hits them, 63%, 70%, that's a huge amount of taxation. In the last bit, I will tell you this, this is an incredible opportunity for the government to make a very strong political stance that we will stand behind honest taxpayers. And I would have preferred if the government said, we are not going to give any subsidies, we're not going to give any grants, we're not going to hand any money to anybody, no schemes, no programs, nothing. We're canceling all schemes and programs of all, all AMSMEs, all AMSMEs, everything canceled. Who has paid tax to us in the last three years? We will refund the amounts they have paid, and that is our only scheme. And it sends a very strong message to the entire economy, you be an honest taxpayer, you pay taxes, and when times are hard, the government will prioritize you. They will see how much payroll tax you have given, they will see how much income tax you've given, they will see how much GST and value added tax you have given, and on basis of that, they will make sure you get some benefits, they will make sure that you get schemes, and they make sure that you will thrive. And so that entire change where the government is already your business partner by taking 63% in taxation, that is 63% of your profit goes to your government, they are your business partner. But that mindset that we are only your business partner during the good times, we are not your business partner during the bad times. That has to fundamentally change, and I completely agree with Pranav, India needs to now say that look, we can take care of our poor people, we can take care of our lower middle class and middle class, we can take care of our big businesses. But now we are a fundamental country that loves and wants to take care of its SMEs and AM SMEs. I think the government has full intentions, I have full faith that the prime minister, finance minister and everybody is working towards this. And I just hope that the policies, and we are seeing lots of policies on this as well, but I just hope that they are able to coalesce the political side of it and get these out sooner rather than later. No, I think that's a very extensive view, but thank you for sharing it. I think we can of course make our taxes simpler and make it easier for MSMEs to be able to breathe in the tax environment of GSC going forward. We have a lot of questions that are coming from our audience who are large primarily MSMEs from different parts of the country. So Punita, if you would want to put some out, please. Sure, Ritu. So we'll give audio to our question from Mr. Rakesh Manik. Can we please give audio to Rakesh? Rakesh, you need to unmute. Pita, you can ask on his behalf, I think. Sure. So Rakesh has a question for a panelist, though he hasn't identified to whom it would be, so our panelists can decide. His question is, what do you foresee as a future of fashion business in brick and mortar detail and self-managed e-commerce website? So Sandeep, you would like to take this off? Yeah, I'll just take this. I'm audible. So Rakesh, see fashion is something which will continue and not in the platform also in e-commerce, all the e-commerce platforms. They see lots of inquiries and people are the demand rising in still at this period. If you see our platform also on the top five categories, one of the categories is fashion still. But only thing is going forward, you have to take care that it will be a most cost sensitive market going forward because of the cash crunch, people will look at lesser price kind of product. And if you can make it with a digital, if you connect with your offline business with the online business and help people to order online and take care of the supply chain, it will sustain. So you don't have to worry about the fashion business right now. So fashion business looks promising going forward. Okay. The second question we can take up is from Amol. Can we please give order to Amol? Yeah, Akash. Now Akash, you were saying that order basis loans, but what should be the criteria, whether it should be only a government related orders which can be which requires a loan or it can be also for a private orders. And if it is a private orders, what will be the goal lateral securities or something like any idea or anything you can see on that? So, you know, first of all, it should not be government based as in it can be anyone. So as a business, no matter who am I providing a service to, service or a product to, if I have a commitment from the particular business, then it should be, it should be something which is factored in. It doesn't matter if it's a government or a private entity. And having said that, sorry, I didn't get your second part of the question, Amol. So you're talking about criteria, is that something you're looking at? Okay, I think I have, let me just look at his chat message. Any collateral then it is required for that type of order? So typically the fact that you have a commitment or a purchase order from someone right that itself serves as a collateral. So the beauty about this kind of capital financing is that it doesn't get into a lot of underwriting. What you're essentially underwriting is let's say I as a business have to provide some service to TCS, for example, right? So the loan is being underwritten on the basis of TCS credibility, not just me, which makes it much simpler because there's a large organization which is backing it. So there is no collateral which is needed for this as such. And just starting to take the point ahead, right? Giving loans on, you know, and basically, you know, having a strong basis to give out loans was also one of the stronger guiding principles behind the implementation of GST. So I think it's about time that is brought in because you look at all the businesses which have been filing, you know, their taxes and GST returns for the last year or so. I think that serves as a very strong basis. And it's about time that it's strictly taken, right? I've seen a very few, you know, NBFCs out there which are looking at your GST returns as one of the stronger criteria to be able to lend out money to you. I think that's something which should really start now. So thanks, Akash. The next question we can take up is from Mr. Mukund Periwal. Please give the audio to Mukund. Mukund, you need to unmute. I think he's unable to unmute. So let me read out his question. So his question is specifically for the textile industry. He's asking, how does Surat's textile industry cope up with the crisis? Any one of you would like to take that? I can go. We have two views on textile. I think one thing that has happened that's unfortunate is that Bangladesh will soon overtake India in terms of the size of its exports, the size of its production, and also, very strangely, the size of its labor force. Textiles was one of India's strongest industries since recorded history. It is disappointing that the government has not done enough to remove friction points in labor, in taxation, in export incentives to help industries, especially the large ones in Surat, to stand up and be able to withstand a shock like this. I think Surat is a good example of how a lack of policy coordination can hurt entire city economies and then crash an entire state. There are so many second and third order effects of the textile economy not being able to withstand a shock like this, because it is a large employer of people who are not fully skilled in job requirements primarily in the top 10 cities. They actually absorb a lot of labor. They absorb a lot of capital. They build specialization and give access for entire families to be lifted up over a generation or two. That's the fantastic reason why textile has always been important to this country. I think Surat will take a hit. I think Surat has withstood resilience before. It has withstood strikes. It has withstood competition from Bangladesh. It has withstood an entire flight of business from India to China over two decades back. If you remember, that was a big problem for most of the textile industry in India. I think this is the best time for the entire industry in Surat to come together and start lobbying this government to make all these sweeping changes at once. I think any industry for that matter whether it's fashion, travel, retail, any industry that has not managed to come together and is looking at a situation like this now where it expects because it was compliant, because it stayed quiet, because it followed the rules, because it didn't make too much noise over the last three or four decades. At a time when the industry is expecting the government and the administration to come up and stand in support for it after decades of compliance and decades of following the system and the government is not stepping forward, the administration is not coming out with quick relief for these industries. The only way to get what you need is to come together and fight for it. I think that that is going to happen. The ministers are on the side of industry. Like Arithya said, we've seen that in multiple conversations with groups like CII, FICI, AIMA and so on. I think the last thing pending is to convince the administration. The IAEA is a bureaucrats state and central civil services. I think if we do that together, that's the strongest chance we have to making all of these reforms pass at once. We must not waste a crisis. We must take full advantage of it as industry and as citizens. Sorry, Puneetha. I'm cutting in, but just to make a point to what Puneetha just said. This is for the entire panel to understand that what is the stimulus privately or in clusters and any industry, not just the textile industry, but pretty much any industry which has been more export-friendly take for more make-in-India kind of initiative. Is this something that can be done in order to bring that aspect in? Because obviously, international trade is why, of course, it is being said that everybody now wants to source from India or from some other countries barring China, which gives us some opportunity leeway. But at the same time, I don't see the trade opening very quickly. I mean, you mentioned Bangladesh, but Bangladesh today has huge stocks which are piling up with them already because the orders that came to them never got picked up. So is there a possibility that we can have more make-in-India from our factories, which are more exporter oriented, coming in, more labor, private labor, more manufacturers, brands? So I'm happy to take that one. I completely agree with a lot of what Pranav said on this. And we've seen that in textiles, but we've also seen that in almost every other sector. India was a leader, and then over time, we've sort of lost that key comparative advantages to others, either smaller countries or larger countries. I know make-in-India has been a focus of this government for sure. And I think most of the international analysts that we're talking to, this is sort of the once-in-a-generation opportunity for India to take up. There is a lot of anger in the system against China, unfounded or not, but there is. That's the perception right now. For the first time, a lot of our companies, we are talking to our counterparts in Europe and the US, and they're really looking for India that, look, please give us a viable option so that we can take it up. And we want to seriously take this up. There is a long list of reforms that need to be done to make India a competitive one export. Very simple. For example, energy is a large cost. Labor is a large cost. You should be able to take input credit into those in some way or form. I've even put proposals in front of the ministry that you should allow payroll taxes, ESIPF, all of it, roll it into a single payroll tax and give input credit on that because that would be a massive, massive jump for labor and export competitiveness. I am not a believer in export subsidies. I am not a believer in this because those are very, they don't last and the moment the subsidies are gone, you become uncompetitive again. What you really need right now is quick, quick immediate reforms, which can be done overnight, by the way. These are not pie in the sky of two years, three years things. A few simple things. One, trade documentation today is not going thing. We know companies who have firm orders, they people want to buy, they have stock, they've figured out how to ship it, everything is ready. But because banks are not handling trade documentation, they are unable to export and they are saying look, our trade desk will open after the lockdown. So they're literally buyer ready, seller ready, shipper ready, inventory ready, not happening. And so the one of the big things what they need to do is really, really push to unlock India's trade system online. The second big push is trade finance. If you look at our exporters, they are in voice factoring from international suppliers and buyers at around 11, 12%. You compare that to China who is factoring at 2 to 3% for their working capital. They are able to give 90 days, 180 days credit. Our guys are barely able to give 30 days credit. And so a massive, massive push on trade finance, which has not happened rather than give subsidies and stimulus and all, if they even create large, large, large pockets of money, which can really drive trade finance and policies that allow a lot of innovative players and NBFCs to enter the trade finance market, that is something that will truly help our exporters. And the third thing, why our exporters were not competitive five years ago and today nothing much has changed there. And so whether you look at labor reforms, whether you look at the ability to do ease of doing business taxation, the average factory which we see requires 17 different departments doing inspections. And there are a lot of states, for example, Tamil Nadu, Rajasthan, etc., who have done head and shoulder work in terms of trying to eliminate those. But now we need a national competitive plan on how do we make our SMEs and MSMEs benchmark and competitive. And part of that is huge reduction in cost of regulation, ease of scaling up, good access to trade systems and capital. And the MSMEs and SMEs will do it. They don't need more than that. If you have an enabling environment, India is very competitive. And I'll quote one of our top industrialists, I don't have permission to use his name for this, but that was a very wonderful way. He said, look, within the factory, India is the most competitive in the entire world. The moment you cross the factory gate, that's when you become uncomparative. And then after we hit the port, post that to become competitive again. So our competitiveness issue isn't in the factory. It is between the factory gate and the export location. That needs to be cleared. Once that is done, there is no reason why India cannot become an export powerhouse. And I truly hope that the government, as one of us says, does not let this crisis go to waste. I truly hope exporters and manufacturers do not let this crisis go to waste. Don't talk about subsidies. Don't talk about bailouts. The government is not going to give that. They don't have the money and they're not interested. But talk about systemic urgent reforms that get long-term competitiveness to the industry. Because short-term is going to be, it'll help short-term, but then it'll be left short-term. So I think, by and large, I agree with what Aditya said. He said a very, very, very broad level. And that's what basically we all should be doing. And especially the ask is from MSME side that facilitation has to be provided by the government. And that's what all the stakeholders in the government should be doing. Basically, if you see MSME, what basically they're going to provide to the export basket and going to have what you call your make in India plan successful. It's basically, of course, the large companies the one side, the biggest hope at this point of time is MSME. But when I asked them last 10 years, I was talking to them last 10 years, when I speak, three things that every time they mentioned, every time one, basically the access to finance. Second is the cluster development. And third is basically market access. And these three things, there are basically the laundry list of maybe the library of all the responses, what they said the concern. But these three things last 10 is consistent. Every year, every cluster we go, every company we ask, these three things is very unique and repeat coming. What we have done from access to finance 10 years back, we had the same problem. The cluster development, we were talking about the export, we don't have anything what we call, you know, ACZ, but unfortunately, just leave out a couple of ACZ, nothing is working. Look at the market access. Unfortunately, we don't have a single program. I mean, one year back up to one year back, that you provide a local MSME the competitive edge to go and fight. Now, you know, let's take one example, very simple example of access to finance. We have taken a four different bucket of the company, micro company, medium and small company. And the second bucket is that the company who has some access to finance, formal access to finance, and second doesn't have any formal access to finance. The micro and medium company who does not have access to finance, they generate some return of capital employed 8% in a year. Whereas when they got on the micro company, basically they generate just 2% of return on capital employed. Both set of companies does not have a formal access to finance. But when they're given formal access to finance, both generated 19% of return on capital employed. Look at the gap for micro company, 2% to 19%. 17% more capital, you know, return they have generated on the capital they have employed. Look at the basically, the opportunity micro company and MSME companies have. And now last 10 years, they're struggling for that. We have not resolved this one. You know, fortunately, what we see, we talk, we spoke about factoring, but that's international factor. We'll come back to the local piece, your supply chain finance, basically, for MSME, two men down the line, the single biggest concern each and every company is going to face is basically short-term fund. That's a working capital fund. And in that space, your supply chain finance is going to help. And the supply chain finance is nothing, no collateral required. Everyone is a win-win, your customer, your anchor company, as well as your vendor, everything is win. Everyone is win-win. And unfortunately, we just have one less than 1% of GDP in India as against 12% in most of the other countries. That you can understand that, you know, last 10 years, looking at the data and the data is giving some promising number and it's a good number that if I facilitate a finance to a company, how much they are efficiently going to generate more return or revenue on that, that we have not leverage on that. Second thing is that we talked about cluster development. But unfortunately, they always struggle for the infrastructure, the basic infrastructure, forget about the labor, forget about the technical skill, the basic infrastructure, your land, water, and electricity is not being provided up to last two to three years back. That's a concern. And we're talking about, you know, the export competitiveness. Of course, we do have, but that is basically the, with the company itself, that's not for the nation. That's one thing. The third thing, I think there's a COVID-19 has given a massive opportunity and Aditya have already mentioned that, that once things settle down, globally, we are going to have a massive recalibration of the political landscape and the policies around that fund. And this will basically be a massive opportunity for Indian entrepreneur and the company to grab that opportunity. That's of course, each and every MSME will have, but that they need a collaborative approach. The government has to frontend. The government has to plan, of course, CI, I just heard that Aditya is working on behalf of that. And that's basically the plan they have to showcase how capable we are and what next five, 10 year and 20 year manufacturing of India looking like and what we can produce and what we can consume and what we can supply to the world. That's the basically a message and that the proper framework has to be communicated to the entire world, basically the manufacturing space, when they look at their trade policy, when they look at their overall economic policy after COVID-19, the India has to be frontend from that perspective. That's what basically I just wanted to add to how we can make and make our MSME competitive and basically export oriented. Sure. Thank you very much for that, Dr. Puneeta. I think we can take one last question before we call it a day. So, we can give one last question to Mr. Gyanshekaru. You can read out his question, Puneeta. Sure. So, Gyan again has a question on taxation. His question is, is there any possibility of GST payable to be reduced for the month of March? I have to talk about that. Look, I think to be very honest to do more fiddling with GST and adding more exceptions, adding this, adding that is not a good idea. I think what the government should be able to do, which all other countries have done, is basically said that whatever people have paid for GST for the last three months, we are going to extend that as a refund to them so they can capitalize and link to the amount of payroll tax they have paid. I don't think they will try to reduce GST because it will set a bad precedent for them where GST is supposed to be used as a systematic tax reform, which it almost has come, but it hasn't quite delivered. So, I would rather see the government using your last one year or last three months, six months GST repeats, not even last three months, now pre-COVID GST receipts as a one-time fund. I again see no mood in the government at all to give any tax defrails or give tax that, okay, for the month of March or something, we'll change the rate. And if they do that, I'll be disappointed because once you get used to fiddling with rates, we had the Kerala Assets, which was terrible because suddenly that one rate, one India went out the window, and that would be a mistake. But yes, using it to give a refund, using it to give some of the money back and saying, we are your business partner, we understand you're in trouble. You have paid us GST for a year, two years, and now that you're in trouble, yes, we are happy to give you one month, two months of GST based on your past performance, I think is very reasonable to ask. So, that's all we have for Q&A today. Over to you, Ms. Mara, to conclude the session. Thank you, Puneeta, and a big thank you to all the panelists for joining us here today and sharing their thoughts. Some of my key takeaways as the editor of the group is that, you know, cash in hand for MSMEs is absolutely vital. They need to make sure that whatever it is that they are doing, they should have cash in hand with them. Taxation needs to be made simpler by the government or at least more variables that could be helpful for MSMEs. And whatever government can do in order to make sure that more cash in hand remains with MSMEs, the better it will be for us to sort of bounce back. Loans at a lower or no rate of interest would certainly be more helpful for MSMEs to come back and make it India could indeed be a big opportunity for today's business, MSME business units in order to look at opportunity in India and going for maybe a quarter or two down the line. It should also start building capabilities for becoming better exporter oriented units because obviously there is an opportunity in the market and a lot of western markets may be looking at India for sourcing. The more capabilities we have developed, the better we are placed to be able to address that market and take the opportunity. And one final point which I would like to say is that I don't know how much the government will be able to do considering that they've got their hands full. So whatever clusterization or however we can, MSMEs can help each other, whether it is to finance, whether it is through, you know, physical capabilities, whether it is the warehouses, factories or however, or the labor resource management, they should come together and help each other in small clusters because that is where they'll be able to get out of this problem faster. So if this is Surat, Surat 100 textile guys should collaborate and see if they can come out of it faster, then they can move the banks, they can move a lot of other bodies which can help them to go faster. So thank you very much. Once again, Dr. Singh Sandeep, Aakash for joining us here today and you know, making this so so good and we're going to post it on social now and make sure that more people are reached out to and more people are able to take advantage of the great content that came out of this one hour. Thank you very much once again. Thanks. Thank you. Thank you all. Thank you. Thank you very much.