Industry bodies warn of migrant labour exodus

INdustry associations on dominicus flagged mounting in operation(p) and financial accentuate among micro, little and spiritualist enterprises (MSMEs), exporters and energy-intensive industries, warning of a potential exodus of migrant labour amid cooking fuel concerns due to a supply squeeze because of the West Asia war.The Confederation of Indian Industry (CII) said the situation remains fluid, with persistent supply-side pressures across energy, logistics and trade channels. “While the first round of policy measures has mitigated the immediate impact, several sectors continue to face operational and financial stress,” it said, citing industry feedback.India SME Forum president Vinod Kumar pointed to growing labour instability across the country’s 78.9 million MSMEs, which employ about 340 million workers, with early signs of reverse migration emerging in select clusters. He added that energy price volatility has hit key industrial hubs, including ceramics in Morbi, glass in Firozabad, foundries and forging units in Ludhiana and Kolhapur, and textile processing in Tiruppur and Surat, citing a recent study.“For migrant workers, access to cooking fuel has become a major issue. They cannot afford to pay as much as ₹4,000–5,000 for a five-kg gas cylinder in the black market. We have asked our members to organise community kitchens so workers can get two square meals. The government must support setting up temporary canteens in key MSME clusters,” he said.Industries in parts of Gujarat have already begun setting up such facilities, he added. The India SME Forum has around 1.02 lakh direct members and over 1.27 million MSME subscribers through its state chapters.“India’s experience during previous crises has shown that coordinated fiscal and monetary action can significantly strengthen resilience. The next phase of policy response may, therefore, need to focus on targeted liquidity support, credit facilitation, trade cost management and foreign exchange stability,” said CII director general Chandrajit Banerjee.CII proposed several measures for immediate, short term and longer term consideration, including a time-bound conflict-linked Emergency Credit Line Guarantee Scheme (CL-ECLGS) providing additional collateral-free working capital to affected enterprises, particularly targeting MSMEs, exporters and gas-dependent sectors. Other recommendations include a three-month interest moratorium, contractual relief for the industry by extending delivery timelines in supplies to the government entities, and a time-bound rationalisation of the tax and duty structure on energy inputs such as waiver of about 2.5% customs duty on LNG imports.CII also proposed that the finance ministry may adopt a calibrated approach to subsidy management, particularly in fertilisers, by gradually transitioning towards direct benefit transfer (DBT)-based delivery mechanisms, while improving targeting through linkage to landholding size, cropping patterns and soil health indicators. “This would help balance fiscal prudence with protection of vulnerable beneficiaries,” it added.Priority sector lending (PSL) norms may be revisited to enable banks to respond more flexibly to sector-specific stress during external disruptions, CII said. It proposed institutionalised inter-ministerial coordination mechanism may be established, including industry, to enable real-time monitoring of sectoral stress, facilitate seamless policy responses across fiscal, financial and trade domains, and ensure effective implementation of relief measures.