The MSME sector will tide over the huge blow caused by the lockdown, and reduce Chinese import dependence by ramping up domestic manufacturing with the government support, Union Minister Nitin Gadkari has said. In a video-conference with PTI, the MSME minister said the government was working on a “war footing” to resolve issues – like working capital crunch and access to affordable financing – faced by the sector, as millions of units stare at staggering losses.
Gadkari said the committees constituted by the Prime Minister’s Office are continuously monitoring and assessing the situation on the ground and would suggest if and when the lockdown can be lifted in certain sectors for normal operations to resume, and added that “work should begin where possible while keeping the virus at bay”. The MSME Minister said nearly 8-10 lakh units will be restructured in the coming days, asserting that owners will have to take care of their workers and put in place mechanisms for proper sanitization as a preventive measure once they return to work.
Gadkari also informed that a Rs 10,000 crore “Fund of Funds” has been approved by the Finance Committee and will be placed before the Union Cabinet for approval. This fund, he said, will facilitate MSMEs to raise money from the capital market, as a portion of their equity will be purchased by the government.
“We will encourage MSMEs to enter the capital market and attract foreign investments, increase exports from the sector through large-scale production and create jobs,” the minister said. He observed that the government was well aware of the issues faced by micro, small and medium enterprises, and packages announced by the Finance Minister will set in motion recovery for the sector.
Gadkari said that recommendations of the UK Sinha Committee appointed by the Reserve Bank of India will soon be implemented. The minister said he has directed district officers to go to banks and facilitate paperwork and coordination for loans to be cleared as fast as possible, and “branch-wise” monitoring was underway to ease the credit woes of the MSME sector.
Referring to reports of nearly 20 lakh migrant laborers living in shelter homes across the country, Gadkari admitted that this was a “serious issue” but said state governments will have to evolve guidelines towards their safe return and factory owners will have to undertake measures to rebuild their confidence. Highlighting that several nations want to source medical devices, masks, and ventilators from India in the wake of the virus outbreak, the minister said this was a “golden opportunity” for the country’s MSMEs to enhance their production capabilities for the future.
(With inputs from the timesnownews)