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Rupee.9.Thmb.jpg 'Popular MSME schemes to continue in 12th plan period'

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Namrata Kath Hazarika | 09 Nov, 2012

The Ministry of Micro, Small and Medium Enterprises is scrutinizing the MSME schemes in order to take a decision which of them are to be continued during the 12th Five Year Plan period, said MSME Secretary Vivek Rae to SME Times in New Delhi on Thursday.

"Since the 11th five year plan has come to an end and the 12th  five year plan is starting, we usually review all our schemes and see which are the schemes which are doing well, for which the demand is there and for which we are able to spend money. And, wherever there is a need for cost correction, we make the cost correction. So, we are doing this exercise now," he said on the sidelines of an event in the national capital.

He said the ministry will continue with the schemes which are quite popular among SMEs in the 12th plan. There are more than ten schemes in the 12th five year plan, which the ministry is focusing on at present.

"First, we will concentrate on our ongoing schemes and then we will think of the new schemes. Some new schemes are under consideration as well. They are yet to be approved. The National Development Council (NDC) will meet soon. Only after that we will know what will be the final initiative," he mentioned.

He pointed out that schemes like Lean manufacturing, Performance and Credit Rating Schemes, TUF schemes for textiles including many more are having good impact on SMEs and are well-utilized. So, these schemes will continue in the 12th five year plan as well.

The Ministry is waiting for NDC to finalize the fund required for the sector in the 12th plan and after that they will plan the schemes accordingly. These funds will be available in a month or two. 

Further, Rae also added, "...most of the schemes are doing well and since our budget is limited, we should be allocating our resources for most of schemes which are doing very well and may be less for the schemes which are not very well. Otherwise, if we spend our resources very thinly then we do not get the impact that we want. There are ten of the major schemes which take much of the resources then the impact will be much more."

The Secretary also indicated that they may or may not continue with the schemes which are not doing well among SMEs in course of time. 

Also, the ministry has plan to come up with 10 more tool rooms in the 12th  plan from the existing 10 at the moment. These tool rooms helps in training and provide invaluable technological support to the industry.

In addition, according to the study that was released at the FICCI event by the MSME Secretary surveyed 2257 firms, spread in 16 cities across all over India, representing both the manufacturing and service sectors reveals that 52 percent of the surveyed SMEs are not registered with the MSME Act. It said 49 per cent of the businessmen in micro, small and medium segments are of the firm view that India's tax structure is proving a big stumbling block to business growth. Inflation is also perceived to be another obstruction to growth of the Indian economy by 41 per cent of the respondents.

Finding also said that 49 per cent of the surveyed firms feel that rolling out GST can reduce the negative effects other schemes have on business growth prospects. Exchange rate volatility is seen as another barrier to business prospects, especially in SME segment, by 33 per cent respondents whereas 36 per cent respondents feel that the impact  of technological bottlenecks to business growth is moderate.

Only 36% of firms could avail financial assistance from banks due to strict procedural norms, lengthy documentation and high interest rates, the study says.

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SME loan for Chemical trading
Krishna rao | Sat Nov 17 01:43:40 2012
Hi Sir, I am Krishna rao, working in a chemical company. I would like to start a Trading company. What is the procedure to get a SME loan. Please let me know all about. Thanks & Regards Krishna rao

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