October 4, 2021 8:38:15 pm
Small and Medium Scale (SME) Industries have asked the central government to restructure their loans and make them easily available to help the industry tide over the negative effects of the Covid-19 shutdown.
Sandeep Belsare, president of the Pimpri-Chinchwad Small Scale Industries Association, had met Union Minister of State for Finance Dr Bhagwan Karad on Sunday and pressed for a complete financial package to help revive the SME sector.
In his memorandum, Belsare said all industries in Maharashtra were closed for two months last year during the nationwide lockdown. This has led to losses with many industries still struggling to return to normal levels of production. While industries were closed, they still had to service their loans as banks had not given any leeway.
“We have asked the Union minister to ensure our interest and loan repayment for those two months are waived,” said Belsare.
Another point that Belsare raised in his letter was that most nationalised banks were reluctant to provide loans to the sector. Most small and medium scale industries banked either with private banks or cooperative banks, whose interest rate is higher. “The minister was apprised of this and we have requested him to bring out a new policy aimed at our sector,” he said.
MSMEs, Belsare said, have the ever-growing problem of non-performing assets and due to the slowdown associated with macroeconomic conditions, they are unable to reduce the same. The central government’s special loan package is disbursed mainly through nationalised banks, which many small and medium scale industries are not able to take advantage of. “The minister should ensure the central government’s schemes are made available to private and cooperative banks also. This will help revive small and medium scale industries,” he said.
The sector has asked the government to take action against large firms that do not pay their vendors within the mandated 45 days. A suitable mechanism has to be brought in to integrate the GST portal with the MSMED Act so that errant companies are flagged, Belsare said. The sector has also asked the government to step in to control the price of raw materials.
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