India MSME Summit – Interim Findings

Issues plaguing the Micro, Small and Medium Enterprises (MSMEs) in India are wide and complex. The India MSME Summit Interim Findings – encapsulates these overarching issues and the concerns that the sector has been facing. The Interim Findings also comes up with the comprehensive list of remedial measures that are urgently required for the MSME sector.

Feedback compiled from Small and Medium Enterprises (SMEs) and 543 Associations has become the part in the making of the Interim Findings.

Highlights


Banking and Reforms

• The overarching concerns of MSMEs are about quality and cost of service, of adequacy and the lack of domain knowledge of bankers. What is needed is a strong and effective regulator of banks in the line of TRAI having focus on consumers of banking services
• Keeping in view of the current slowdown and ensuring crisis, the sectors needs: Extension in NPA (Non-Performing Assets) norms to180 days for two years; moratorium for effected MSMEs for term loan repayments; dropping requirement of Additional collateral for temporary enhancement in Working Capital Limits

Policy Reforms

• Need for modern codes for Insolvency and Bankruptcy for MSMEs
• An effective Competition Commission to ward off cartels and monopolies prevailing in raw material and services
• Establishment of GST

Markets

• Need for a set aside of 20 % for MSMEs in Government procurement
• Need for addressing the problems of delayed payments to MSMEs by large companies and PSUs; and
• Most importantly, guarding against the trend of protectionism.
• Tariff and non-tariff barriers imposed on Steel, Copper, Aluminum and Polymers need to be removed.