Businesses are struggling with rising cost of raw materials amid the second COVID wave as restrictions in many parts of the country have disrupted supply chains and also impacted the pace of economic recovery, industry body PHDCCI said on Monday.
In a survey, the industry body said that going ahead, a substantial stimulus to push the growth of the Indian economy impacted by the second wave of the pandemic would be crucial.
"The survey, which was conducted across 34 sectors, revealed that 73 per cent of respondents were struggling with rising cost of raw materials as restrictions in many parts of the country have impacted the pace of economic recovery with uncertain economic environment, disruptions in supply chains and contraction in demand,' it added.
Other key challenges faced by businesses include availability of working capital, maintaining price-cost margins/ profitability, weakening of demand, retaining the full workforce, wages/salaries, and repayment of loans.
It added that companies are prioritising vaccination of employees as one the key strategic plans/ focus areas to tackle the situation.
"Coronavirus 2.0 induced restrictions in the country have created a difficult time for the industry. The entire economic activity is severely impacted with the closure of offices and shops," PHD Chamber of Commerce and Industry President Sanjay Aggarwal said.
The supply chain disruptions are causing skyrocketing commodity prices, which have severely impacted the price cost margins of the businesses in the difficult pandemic time, he added.