The Center has created a framework for revival and rehabilitation of MSMEs, which account for nearly half of the non-performing assets (NPAs) of banks from the industry sector, MSME Minister Kalraj Mishra has said.
The MSME Ministry would immediately take steps to set up a “design studio” as a “common facility center” (CFC) in Tirupur knitwear cluster so that large number of units could utilize it to give value-addition to apparels, he told reporters in Tirupur
Of the Rs 1.13 lakh crore NPA of banks from industries , the Micro Small and Medium Enterprises sector alone accounts for Rs 40,000- 50,000 crore, he said.
The high NPAs or bad loans of the sector is a cause for concern for the Ministry, which has created a framework for revival and rehabilitation of the units, Mishra said.It provides for identification of incipient stress in MSMEs, and the committee constituted by banks for distressed firms will prepare a corrective action plan so that they are given an opportunity to get revived, rehabilitated or closed, he said.
More than 53,000 MSME units are functioning in Tamil Nadu, and with the help of the state government his Ministry will identify a cluster in Coimbatore to provide a boost to the sector, he added.
The sector is facing the challenge of high cost of funds and lack of marketing strategy, the MSME Minister said, adding that he favors lower interest component for MSMEs. The Ministry is also trying to implement E-governance in the department so that all transactions became transparent, leading to corruption-free administration, he said.
