6 lakh MSMEs restructured, coronavirus offers opportunity to

The government on Monday said in Rajya Sabha that six lakh industries under MSME have been restructured and urged the sector to look at opportunities for expansion following the global impact of coronavirus. Replying to a query during the Question Hour in the Upper House, MSME and Road Transport and Highways Minister Nitin Gadkari said six lakh industries under MSME have already been restructured and by December 31, the extended date for restructuring, the numbers will increase.

"It is not practically correct to say anything about this, but because of coronavirus now a lot of opportunities are with the Indian industries," Gadkari said in reply to another supplementary on the impact of Coronavirus on MSMEs. In reply to another query regarding job losses or production losses in the sector, the minister said, "The straight answer is no." He said as far as exports and employment were concerned they were growing but underlined the need for timely payment to industries by central and state government undertakings.

"The major problem is the state government and central undertakings... they don't give money of small MSME," he said and added that if one company is impacted thousands are rendered jobless. There is no provision to protect the interests of industries under MSME in the NCLAT Act, he said.

He said his department was contemplating taking action against the heads of such central or state undertakings that do not make payments within three months and the steps included 12 percent interest on the amount. He noted that the earlier date of restructuring which was March 31 has been extended to December 31 and exuded confidence that a large number of industries will benefit from the move.

"We have restructured 1.5 lakh accounts," the minister said, adding massive steps were on so that no account should turn NPA. Stressing that the government is extending full support to MSMEs, the minister said that the recommendations of the UK Sinha Committee have been accepted and "during January 2019 to January 2020, over six lakh accounts have been restructured under the circular covering loans of Rs 25,000 crore." Besides, one of the recommendations of the Sinha committee about "Fund of funds" to provide debt and equity support is being finalized.

He added: "Finance Secretary has approved it...it will go to the Cabinet." Also, distressed asset fund is being created, he said and added that demonetization has had no impact on the sector. Rather this along with GST has ushered in economic reforms.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)