ECC approves relief package for small businesses, daily wage workers

Relief package for daily wage earners will be distributed among four to six million people

The Economic Coordination Committee (ECC) has allocated Rs75 billion to provide relief to labourers and daily wage workers who have lost their jobs during the coronavirus outbreak.

The ECC also approved a Rs50.69 billion package to provide indirect cash flow support to the small and medium-sized enterprises (SMEs) through pre-paid electricity.

"Small businesses having a commercial connection of less than five kilowatt and industrial consumers using less than 70 kilowatts can benefit from this initiative," said Minister for Industries and Production Hammad Azhar following today's ECC meeting.

"Around 3.5 million people running small businesses like tailor shops, small markets, and industrial units will take advantage of this initiative and this programme will equally be available for the people of Azad Kashmir as well," added Azhar.

Elaborating on the relief package for daily wage workers, he said Rs12,000 will be distributed among four to six million people in addition to the 12 million people benefiting from the Ehsaas program. He added a portal for the initiative will be launched after the federal cabinet's approval on Tuesday.

"Labourers and daily wagers can get themselves registered by accessing the portal and filling the requisite information," said the minister.

A credit loss subsidy of Rs30 billion for the Risk Sharing Facility for State Bank of Pakistan’s Refinance Scheme to support employment and prevent lay-off of workers also got the nod of approval.

A recent Small and Medium Enterprises Development Authority (SMEDA) survey found that lockdown imposed to stem the spread of the Covid-19 pandemic a caused a reduction in operations of 95pc businesses, 92pc complained about a disruption in their supply chain and 23pc reported a total loss in their export orders.

The lockdown across the country is expected to make the situation dire for the estimated 5.2 million enterprises in the country, the report read, adding that the small businesses may experience supply chain disruptions because of the irregular supply of raw material and intermediate goods, revenue loss and shortage of liquidity to continue business operations.