LAHORE: The government is expected to finalise its support package for the owners and employees of the small and medium enterprises (SMEs) this week.

Additionally, it plans to launch a Rs75 billion ‘Mazdoor ka Ehsaas’ cash support programme for daily wage-earners and low-income workers as late as next week. It may be recalled that the government had set aside Rs200bn for the purpose in its Rs1.2 trillion Corona relief package announced by the prime minister last month.

Under the programme, the daily wage-earners and low-income workers, who have been rendered jobless because of the economic shutdown on account of lockdown enforced by provinces to stop the spread of the coronavirus, will be provided Rs12,000 a month each for three months as cash support. A summary has already been forwarded for prime minister Imran Khan’s approval.

Sources in the federal industries ministry told Dawn on Monday that the Rs100bn relief package for the small to medium sized enterprises in the manufacturing, agriculture and retail - also part of the federal Corona relief programme – would cover their “immediate vulnerabilities and cash flow problems” during the lockdown and take care of their financial needs for the resumption of the business once the restrictions are lifted.

Govt plans Rs75bn ‘Mazdoor Ka Ehsaas’ cash programme

“However, the package remains unimplemented because we are still firming up modalities. A team of senior officials of the Small and Medium Enterprise Development Authority (Smeda) is designing the programme and firming up its details,” an official told this reporter from Islamabad by telephone.

He said the details would be finalised during this week and announced after formal approval by the prime minister. He said the total size of the package could be in excess of the money already announced, depending upon the final design of the programme.

The relief package will provide “soft loans” to all types of SMEs to cover their wage bills, utilities, rent, etc during the lockdown period. Besides, they will also be eligible for soft loans for meeting their working capital needs when they recommence business activities.

Nevertheless, the SME owners are not happy with the government plan, saying the interest-based soft loans will prove to be just another liability for them. “If the government wants to help us, it should give us grants and not loans,” an office-bearer of the Quaid-i-Azam Industrial Estate in Lahore said.

Speaking on condition of anonymity, he said it appeared as if the government was working for banks and large businesses rather than for the small manufacturers and retailers who are 90 per cent of the businesses and employ over 45pc of non-farm workforce in the country.

Published in Dawn, April 14th, 2020