Bangalore, Aug 18 (KNN) As the Micro, Small and Medium (MSMEs) are going through an existential crisis, Karnataka Small Scale Industries Association (KASSIA) believes that 20 per cent may never be able to restart as they have been hit fatally by the COVID-19 pandemic.

During a press conference on Tuesday, KASSIA president KB Arasappa said that small industry is very vulnerable to shocks and has the least capacity to absorb them and the pandemic has caused irreparable damage in a large number of cases and many will find it impossible to revive.

''It is our rough estimate that about 20 per cent may never be able to restart as a result of the disruptions caused by the pandemic,'' he added.

He said that this is mainly due to the compounding of the already existent economic slowdown by the unexpected spread of the highly infectious and life-threatening disease which has uprooted workers and production systems in factories.

''We are suddenly faced with broken supply chains, cancelled orders, over extended payments, loss of jobs and livelihood, loss of markets, and dried up financial sources posing a serious threat to our very existence,'' he said.

In the aftermath of the lockdown industry has been trying very hard to re-establish by reviving production in the face of the persisting pandemic and continuing absence of workers and hard to find demand for products and services, he pointed out.

He also said that undoubtedly, both the central and state governments have come forward stepping up financial and other assistance to MSMEs in various ways by pumping in liquidity and access to credit which have been helpful adding, ''but many problems remain.''

''Most of all, absence of demand, which requires economic stimulus on a substantive scale in order to kick-start the economy and this is nowhere visible. This requires immediate attention in order to sustain industry, particularly MSMEs, in what is likely to be a prolonged drop in global and domestic demand for the foreseeable future even if the pandemic is brought under control or peters out in the next six months to a year,'' he asserted.

The president further said that the KASSIA has continuously engaged with the central and state governments, post pandemic, conveying the various issues of vital concern to the governments and discussed the relief measures and their implementation based on the real problems faced by industry on ground, be it the  ECLGS and related packages,  questions about their execution by the banks, need for injecting cash into micro and small enterprises, procurement issues, delayed payments, infrastructure and related matters and the overall need for economic stimulus.

''Though the governments have been responsive, a great deal yet remains to be done,'' the president added.