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Sunday, April 11, 2021

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07 Apr 2021 18:55:41

Lockdown logic an obvious flaw

Lockdown logic an obvious flaw
The Business Post photo

Nazmul Ahsan

Syful Islam runs six outlets of his fashion house called ‘Arosh’ in the capital’s six shopping malls, with one of them being at Bashundhara Shopping Mall and another at Capital Seraj Centre on the bustling Bailey Road.

His factories that produce male attire like punjabi, shirts and pants for his outlets are allowed to operate now, but all the six sale centres are closed thanks to lockdown measures.

On Tuesday, Syful asked his ‘karigars’ (dressmakers) not to get to his dress-heaped factory in old Dhaka any more. There is no place to keep clothing in his factory building. His workers have already sewn a huge number of clothing items targeting bonanza sales ahead of the upcoming Pahela Baishakh and the ensuing Eid festival.

“Who does formulate lockdown policy? What is the rationale of allowing factories and industries to run if their manufactured goods cannot be sold in the market?” a perplexed and devastated Syful vented his frustration on The Business Post.

“I incurred a loss of around Tk 5 crore during the shutdown last year which came into force a little before the Ramadan and the Pahela Boishakh.”

Traders and small and medium enterprises owners hardly received any attention from the policymakers and the banks as well to offset their losses caused by the pandemic-induced lockdown last year.

The small businessmen, as we are, have a considerable number of employees for their sales outlets and factories without any fiscal or monetary benefit from the government, said an aggrieved Syful.

Terming the government policy to rein in the pandemic effect wrong, he said small traders are bearing the brunt of the shutdown.

“Please, do something for us, so our shops remain open to clear our ready clothing items while traders don’t encounter another business debacle this time,” pleaded the businessman.

The country has gone into a fresh lockdown for a week starting last Monday, following a staggering rise in COVID-19 cases and deaths since late March.

Road Transport and Bridges Minister Obaidul Quader on Saturday said the government was all set to impose the countrywide lockdown as part of its effort to curb the new wave of the pandemic.

According to State Minister for Public Administration Farhad Hossain, all offices and courts will remain closed during this period but industries and factories will continue to operate following health guidelines and ensuring shifting duty.

Shop owners and small traders in the capital and some other districts have been demonstrating for three days in a row, seeking permission to open their outlets.

Even, they have vowed to maintain strict health guidelines and physical distancing while in business.

According to the data of Bangladesh Bureau of Statistics, the number of shops with less than 15 employees in the country is 56 lakh where as many as 1.20 crore employees work.

If the average monthly salary of each of the employees is Tk15,000, the total amount stands at Tk18,000 crore while the daily losses caused by the ongoing shutdown are estimated to be around Tk1,100 crore, as per the data of the shop owners' association.

A leader of Bangladesh Dokan Malik Samity told The Business Post that the government policy on running factories and shutting shops lacks prudence.

He urged the government to keep shops and shopping malls outside the purview of the ongoing lockdown.

When it comes to the small and medium enterprises (SMEs), boutique and fashion houses that produce stuff for shops, sale centres and business establishments housed in shopping malls, they also feel the same pinch as their peer partners do.

Due to the short-sighted policy of the government, these medium and small factories cannot function or largely stay closed as their produced items have nowhere to go for sale.

According to a study of the Planning Commission, the total number of SMEs in Bangladesh are estimated to be 79,00,000.

Of them, 93.6 per cent are small and 6.4 per cent are medium. About 60 per cent to 65 per cent of all SMEs are located outside the metropolitan areas of Dhaka and Chattogram.

The country's SME sector created 15 lakh jobs between 2009 and June 2014, says a study.

Now, private and foreign banks disburse half of all farm loans while a third of these is going to the SMEs. Every year about two million youth join the country's workforce, half of which find jobs at home or abroad. So, it has turned out to be a challenge to create more jobs, and the SMEs can be an answer to the problem, adds the survey.

The small and medium enterprises are the biggest employers in the informal sectors, but those jobs are not protected against vulnerabilities. The shutdown of shops, markets, restaurants and businesses of all sorts rendered millions of people jobless when the country enforced closure last year.

A local think tank South Asian Network on Economic Modeling (Sanem) said in a recent survey the shutdown induced by COVID-19 took away 60 lakh jobs in Bangladesh. The employment loss forced above 20 per cent of people into new poverty.

Lockdown imposed this time may cost 30 lakh workers’ jobs, Sanem predicted on Sunday.

The government on Tuesday decided to allow bus services in Dhaka and other city corporation areas from today (Wednesday), but announced nothing for shopping malls.

Ridesharing bikers are also one of the worst victims of the lockdown contradictions. They also joined the street protests in Dhaka.

“While buses can ply across the city maintaining health guidelines, why should ridesharing not be allowed to do so in compliance with the same regulations?” they posed a question.

According to a survey on the privately run mechanised and non-mechanised land and water transport by the Bangladesh Bureau of Statistics, about 1.39 lakh people are engaged in apps-based bikes and car services adding Tk8,342 crore as value to the economy annually.

The transport sector, both mechanised and non-mechanised put together, employs 29 lakh people in 24 lakh vehicles for passengers, says the latest survey of BBS.

One can easily fathom out the dilemma of the government in halting corona and letting business function. Defeating a deadly virus needs a holistic approach as a piecemeal ill-conceived attempt to stem the surge would be counterproductive for lives and the economy altogether.

Therefore, it is still time to rethink measures and redouble efforts to keep the raging pandemic at bay and put lives and livelihoods back into action before it is too late.

 

The writer is the Executive Editor of The Business Post