HindustanTimes Sat,20 Sep 2014

And now, SMEs get an exit policy

Debobrat Ghose, Hindustan Times  New Delhi, July 18, 2012
First Published: 20:38 IST(18/7/2012) | Last Updated: 22:15 IST(18/7/2012)

Vishakhapatnam-based small entrepreneur P Anand Rao and thousands across India can finally breathe easy. The government has finally decided to come up with the much-awaited exit policy for sick and closed industrial units in the small and medium enterprises (SME) sector.


After Rao’s unit became sick and he failed to clear his bank dues, his accounts turned into non-performing assets (NPAs) or bad loans. Debt-ridden, Rao is now knows as the “defaulter”.

The policy may help such entrepreneurs to get rid of the “defaulter” tag. The policy will give sick and closed SMEs an exit route to get rid of their statutory dues, bank liabilities and money owed to creditors. 

The ministry of micro, small and medium enterprises (MSME) is working on the final draft of the exit policy, sources said.

“The policy will give specific time to sick units for settling their issues and should create a win-win situation both for the entrepreneur and the bank,” a senior ministry official told HT.

“There is a need of a single institutional mechanism to deal with multiple agencies and if this policy comes into effect, it'll  help an entrepreneur to get free from increasing debts,” said VK Agarwal, president, Federation of Indian Micro & Small and Medium Enterprises (FISME).

more from Business

Larry Ellison steps down as Oracle CEO after 37 years

Larry Ellison, co-founder and leader of Oracle Corp for 37 years, stepped aside as chief executive officer on Thursday, to be replaced by co-CEOs Safra Catz and Mark Hurd, raising questions about a job-sharing arrangement that has had a fraught record elsewhere.
Most Popular
Copyright © 2014 HT Media Limited. All Rights Reserved