Financial Management of Micro, Small and Medium Enterprises during COVID Times?Analytical Review with reference to Indian MSMEs
Published: February 28, 2022
COVID-19 outburst has harmed not only the Indian economy’s economic and social activities, but also the global economy as a whole. Cushioning levels of shocks especially for financial downs remain to be restricted for MSMEs. The main reason is due to limited potential for raising and management of funds. This generates a significant impact on MSMEs. This paper seeks to evaluate MSMEs’ contribution towards the Indian economy along with analyzing the barriers and challenges that existed prior to and during the COVID period. Challenges were indeed in presence before COVID 19 also but during and post COVID 19, their intensity, severity and scope have changed a lot. In addition, a few more are also emerged newly. To analyze the overall effect and impact of these challenges, a range of descriptive statistics along with correlation and co-integration is used. Cointegration is used to analyze the relation among variables such the amount of MSMEs, investment amount, employment, etc. output. This pandemic has crashed into MSMEs like a tons of bricks. COVID 19 remains to be a huge uncertainty and with the understood scope of this uncertainty so far, government must establish a continuous monitoring mechanism and announce early corrective actions to restore confidence in the MSMEs sector. MSMEs should be encouraged to connect to the internet market and fiscal incentives for this sector should also be strengthened. The Indian government should take a variety of initiatives to improve SMEs in India and achieve the goal of making India self-sufficient.