Small Industries Development Bank of India (SIDBI) plans to promote environment-friendly firms and equip Micro, Small and Medium Enterprises (MSMEs) to adopt environment-friendly technology in their operations. It is also working towards eliminating child labour, which is rampant in the MSME sector.
“We largely eliminate any risk arising out of non-compliance of statutory requirements relating to pollution control and non-tariff barriers like child labour and host of industry hazardous materials of substances, which requires certain handling procedures and training under various Acts and legislations,” said N. K. Maini, Deputy Managing Director, SIDBI, while talking to The Hindu .
SIDBI has been implementing these standards for the last few years, and has over 7,000 loans covered under such framework besides over 3,500 loans for adopting energy-efficient technologies or clean production technologies by MSMEs. “New loans are provided on the basis of conformity with this framework as also for procurement of energy-efficient equipment and adopting clean production technologies. We also encourage MSMEs to go in for green construction,” said Mr. Maini. He said most of the banks directly or indirectly covered quite a few of these frameworks as part of their project appraisal. However, “our effort is that the entire framework gets integrated into the mainstream lending banks, non-banking financial companies (NBFCs) and all other financial intermediaries.” This is in line with the sustainable development agenda not only of SIDBI but also the agenda adopted in the recently-concluded United Nations Conference on Sustainable Development and Climate Change in Rio de Janeiro, Brazil.
ADVERTISEMENT
Outstanding credit
Meanwhile, SIDBI’s outstanding credit to the MSME sector increased to Rs.53,785 crore in 2011-12. Cumulative disbursement stood at Rs.2.45 lakh crore, benefiting more than 325 lakh people. The net profit after tax increased to Rs.567 crore from Rs.514 crore in the previous year. The net worth of the bank increased to Rs.6,399 crore.
Financial support by way of equity and other forms of risk capital to MSMEs would be through the Rs.5,000-crore India Opportunity Venture Fund, which was announced in the Union Budget 2012-13.
ADVERTISEMENT
Similarly, to address the development services gaps, SIDBI would enable credit facilitation in association with industry associations, initially in 100 MSME clusters.