'Committee constituted by RBI to discuss issues of MSMEs'

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SME Times News Bureau | 14 Aug, 2013
Expressing the government's concerns about the growth of the Micro, Small and Medium Enterprise (MSME) sector, the Minister of State (Independent Charge) for MSME, K. H. Muniyappa Tuesday informed that RBI has constituted a standing committee for welfare of the sector and to discuss issues concerning MSMEs.

"A Standing Advisory Committee has been constituted by the Reserve Bank of India (RBI), with Deputy Governor as Chairman, officials of Ministry of MSME, Banks and Associations as members, to discuss issues concerning MSMEs," informed Muniyappa in a written reply to a question in the Rajya Sabha on Tuesday.

"The Committee examines issues relating to improving of credit to the MSME sector, difficulties/ constraints experienced and steps taken to overcome them," he added.

Further, Empowered Committee (EC) on MSMEs have been constituted at the Regional offices of RBI, under the Chairmanship of the Regional Directors with the representations of SLBC Convener banks, senior level officers from two banks having predominant share in MSME financing in the state, representative of SIDBI Regional Office, the Directorate of Industries of the State Government, one or two senior level representatives from the MSME/SSI Associations in the state and a senior level officer from SFC/ SIDC as members.

EC meets at least once in a quarter to review, inter-alia, the credit flow to MSE sector and coordinates with banks/ financial institutions and State Governments to ensure smooth flow of credit to the sector, the minister said in his reply.

As per data maintained by Directorate General of Commercial Intelligence and Statistics (DGCI&S), MSME sector's contribution to India's total exports during 2012-13 was 43 percent.

The Government has been implementing various schemes/programmes to increase MSME sector's contribution to exports.

Replying to another query, Muniyappa said that the government has approved an outlay of Rs 8,060 crore, under Prime Minister's Employment Generation Programme (PMEGP), to set up 3.39 lakh projects which would create about 27.12 lakh jobs.

"An outlay of Rs 8,060 crore has been approved for PMEGP in the 12th Plan to set up 3.39 lakh projects which would create around 27.12 lakh employment," said Minister.

Under the PMEGP, urban and rural entrepreneurs in the general category can avail a subsidy of 15 per cent and 25 per cent on the project cost. In the case of weaker sections of society, a 25 per cent and 35 per cent subsidy is provided to urban and rural businessmen.

During the 11th Plan, margin subsidy of Rs 3,131 crore was released under PMEGP, against which a utilisation of Rs 3,067 crore has been achieved, providing employment to an estimated 16.07 lakh persons through setting up of 1.64 lakh projects, Muniyappa said.

The scheme aims at generating employment through setting up of micro enterprises, including rural industrial units.