SMEs in poor shape despite growing GD
EVEN AFTER a fair contribution to the gross domestic product (GDP) as well as spurt in country?s export, the condition of the small medium scale industries (SMEs) is not at all satisfactory. This has led to industries putting in a great endeavor to survive in the market, said VK Malhotra, secretary of the Unorganized Enterprise Commission of Central Government. Malhotra was addressing a seminar here on Thursday.india Updated: Nov 11, 2006 00:52 IST
EVEN AFTER a fair contribution to the gross domestic product (GDP) as well as spurt in country’s export, the condition of the small medium scale industries (SMEs) is not at all satisfactory. This has led to industries putting in a great endeavor to survive in the market, said VK Malhotra, secretary of the Unorganized Enterprise Commission of Central Government. Malhotra was addressing a seminar here on Thursday.
Malhotra said that the government of India has not only chalked out certain plans to provide assistance to these small medium scale industries, but also the labourers working in these industries.
It is in this regard that plans have been mooted to bring a proposal in the Parliament with regards to providing employment insurance to the labourers of the unorganized sector. On the other hand, government was also trying to provide loans and raw material to the industrialists easily, added Malhotra.
Despite more than 5 crore small medium scale industrial units in the country, the sector holds only 8 per cent of the share in the GDP besides was facing various problems at every step.
The SMEs have to face a lot of problems created by the financial institutions.
Malhotra opined that loan amounting to Rs 25 lakh should be provided without any Collectorate security, but till now no such arrangements were made. Such was the problem that even the banks sanction loans to the old and established industry easily but creates problems if it has to be sanctioned to a new or a budding industry.
However, the fact is that these new and budding industries need loans desperately. Therefore, the banks should look into the matter seriously and change their viewpoint while sanctioning loan to these industrial units, suggested Malhotra.
Further detailing about the boosters given to Small Medium scale Malhotra said that the time limit of government’s Technology Up gradation Fund (TUAF) plan which was valid till March 2007 has also been extended, which would definitely prove to be beneficial to the industrialists.
The industrialists present on the occasion also urged the government to direct the financial institutions to be liberal towards small and medium scale industries.
They also suggested that loan subsidy should also be provided under the Prime Minister Rozgar Yojna other than the same simply providing subsidy on interest rates, so that the misuse of this Yojna could be reduced.
Those present during the conference were Joginder Prasad, Dr CR Prasad, Manoj Banka, Mikki Manchanda, Ladla Prasad and others.
First Published: Nov 11, 2006 00:52 IST