Small businesses worry as threat of Covid third wave loomsNepal on Monday reported 1,446 new coronavirus cases. On January 2, the daily virus cases were just 216.
With the early signs that the third Covid-19 wave is here, Jassimuddin Mansoor, a tailor, is worried.
Mansoor, proprietor of MP Tailor, Tripureshwor said: “I cannot imagine the next lockdown and closing down the business for months.”
Following the Covid-19 Crisis Management Coordination Centre’s Sunday’s recommendation, the government has decided to close schools across the country until January 29 effective from Tuesday.
This is the first step that the government has initiated to prevent the spread of Covid-19 amid the beginning of the potential threat of the third wave.
But for people like Mansoor, it’s the beginning of stress, fear and worry.
“In my 26 years of tailoring business, these two years [2020 and 2021] have been years of fear and worry. My business hit rock bottom during the first lockdown,” Mansoor told the Post. “The second lockdown was more painful.”
Mansoor said that it was difficult for him to pay the rents of the shops and rooms and manage daily expenses. “I managed the expenses by taking loans from relatives.”
He is again worried because he thinks the bad days are back again. The daily cases of Covid-19, which has nearly jumped seven-fold within a week, show how rapidly the virus is spreading again.
Nepal on Monday reported 1,446 new coronavirus cases. On January 2, the daily virus cases were just 216.
Entrepreneurs associated with cottage, small and medium businesses have started fearing the third wave of Covid-19. This sector was badly hit by the first and second waves and the government failed to address their problems.
But despite all odds, cottage, small and medium businesses were making a rapid recovery.
According to a follow-up survey on Impact of Covid-19 in Economy published by Nepal Rastra Bank, 88.4 percent of cottage industry had come into operation till mid-November.
Similarly, 86 percent of micro and small retail businesses had come into full operation.
But the virus has struck back.
“As educational institutions have closed down, there is definitely a big fear in the industry,” said Umesh Prasad Singh, acting president of the Federation of Nepalese Cottage and Small Scale Industries. “We fear that the government will impose a lockdown again.”
“Even if the lockdown is not imposed, businesses will face ruin because of the fear factor.”
The world is living in fear particularly with the arrival of the new variant, Omicron.
“I have been receiving frequent calls from industry people on what will happen next. The situation is already uncertain,” Singh said.
The lockdown this time is expected to collapse many businesses, he said.
Singh said that Nepal Rastra Bank has given a refinancing facility, providing credit at 5 percent interest, but not even 2 percent of small entrepreneurs have benefited.
Access to bank credit remains limited for small businesses with just 16 percent of them going to banks and financial institutions, according to a report entitled Small and Medium-Sized Enterprise Monitor published by the Asian Development Bank.
Entrepreneurs have been running their business by taking loans from friends and relatives or by selling land while some entrepreneurs have collapsed from the business and are engaged in trading, Singh said.
The government has earmarked Rs13 billion in the budget for the fiscal year 2021-22 to provide concessional loans at 5 percent interest to micro, small and medium enterprises, commercial agriculture, youth enterprises, women enterprises and persons returning from foreign employment.
Micro, small and medium enterprises contribute 22 percent to the country's gross domestic product (GDP).
In the last fiscal year 2020-21 ended mid-July, when the economy lay crushed under the coronavirus, registrations of new firms—mostly micro, cottage and small scale enterprises broke all records to reach an astounding figure of 83,386, as per the Department of Industry.
In the previous fiscal year 2019-20, the number of new firms registered totalled 48,854.
Many firms have been registered to get the facilities provided by the government, and this has been hurting the genuine micro, small and cottage industry, industry insiders said.
Mansoor is living in fear. “The inflation is already dreadful. Everything is expensive,” he told the Post. “I think we cannot brave the third wave.”