Govt Incentives to help MSMEs, says Dye Chem Industries chief

Mumbai: The government’s incentives for the medium and small scale industries will be considerably helpful in helping them out of the Covid-19 crisis, said an industry executive.

But specific sectors need more handholding and customised measures to turn around in the next six to nine months.

“We have faced losses. Exports have dried up. We would need at least 9 months or more to be back to normal. With the incentives from the govt, that has now been shortened to 6 months,” said Yogesh Parikh, owner of Ahmedabad based Avani Dye Chem Industries speaking at a Bennett University discussion.


The government has announced Rs 3 lakh crore collateral free automatic loans for businesses including MSMEs, Rs 20,000 crore subordinate debt for stressed MSMEs and Rs 50,000 crore equity infusion through a fund of funds.

The definition and scope of the segment will also be changed with an upward revision of investment and turnover limits as well as a distinction between manufacturing and services.

Parikh said the dye industry is dependent on China for raw materials called dye intermediates and that has been severely affected.

He said the government should help in giving faster environmental clearances—preferably within 90 days—so that the industry can become self dependent in producing its own raw materials. Self dependence for industries is a keyword in the govt’s latest set of incentives to see industries through the Covid19 crisis.

Parikh said that done, the dye industry can export up to 90% of its output.

Dyestuff production volume in India is projected to reach 572.2 thousand tonnes in 2024, increasing at a CAGR of 9.11%, during 2020-2024, according to a report from Market Insights.

The production volume in China is expected to reach 1,027.5 kilotons in 2024, increasing at a CAGR of 5.04%, during 2020-2024.

The Covid19 crisis is also bringing in a new normal for MSMEs, said Parikh adding a lot of paperwork is now happening over emails. “This should and will continue,” he said.