write down the causes consiquens of industrial sickness
Answers
Answer:
An attempt has been made in this section to discuss the various consequences of industrial sickness in a more orderly manner:
Huge Financial Losses to the Banks and the Financial Institutions:
The banks and the financial institutions provide substantial funds to start an industry. Obviously, the locking up of substantial funds in the sick industrial units impinges on the future lending capacity of the banks and the financial institutions.
Further, recovery of overdue takes an unduly long period of time and in many cases only a small portion of overdue amount is finally recovered. Thus, these bear an adverse effect on the financial health of the banks and the financial institutions.
Loss to Employment Opportunities:
One of the serious consequences of industrial sickness has been loss to employment and, thereby, aggravating the most dangerous socio-economic problem of unemployment in a labour surplus economy likes ours. According to an estimate, nearly 30 lakhs of workers are likely to be affected by the closure of sick and weak units.
In relative terms, about 6% of total employment in industrial sector is likely to be affected by industrial sickness. Out of total 30 lakh workers likely to be affected by closure of sick units, even more than two-thirds (68%) of total will be rendered jobless in small sector alone. This presents a grim prospect in the employment scenario of the country.
Explanation:
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Loss to Employment Opportunities:
One of the serious consequences of industrial sickness has been loss to employment and, thereby, aggravating the most dangerous socio-economic problem of unemployment in a labour surplus economy likes ours.
Causes of Industrial Sickness:
(i) Recession in the Market:
(ii) Decline in Market Demand for the Product:
(iii) Excessive Competition in the Market:
(iv) Erratic Supply of Inputs:
(v) Government Policy:
(vi) Unforeseen Circumstances:
(i) Faulty Planning:
(ii) Incompetent Entrepreneurs: