While several industry captains and chambers of commerce lauded the ‘Atmanirbhar Bharat Abhiyan’ package , the MSME sector, which has a huge presence in Tamil Nadu, appeared less enthused. A handful of other sectors too felt that the economic package under the scheme for a self-reliant India, unveiled by Union Finance Minister Nirmala Sitharaman, may not be of help to them in the immediate future.
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“It is disappointing for small and medium enterprises as none of the announcements will help us immediately. The only relief is that all pending payments from government will be cleared in 45 days. No interest waiver was announced for the COVID-19 lockdown and there is also no reduction in GST,” said S. Vasudevan, joint secretary, Tamil Nadu Small and Tiny Industries’ Association.
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Besides, the conditions for availing Provident Fund (PF) contributions have not been relaxed. “It is very difficult to meet the norm that 90% of employees should earn less than ₹15,000 as monthly salary,” he added.
K.V. Kanakambaram, president, The Industrial Estate Manufacturers’ Association, felt no financial support was provided for micro and small units to resume operations, which would require immediate funds.
“The new definition of MSMEs is not going to help the existing units that have been suffering for the past five years. About 75% of the existing MSMEs will cease to exist. The new definition will help big companies enter the MSME sector and enjoy all benefits of the struggling units,” he contended.
According to him, the 10% working capital loans announced by the banks in March cannot not be availed by MSMEs because of paperwork and documentation being insisted by the bank. “Banks are wary of giving these loans to existing MSMEs units citing various reasons. There is no monitoring mechanism to check the percentage of loans in the scheme,” said Mr. Kanakambaram.
Padam Dugar, president, CREDAI- Chennai Chapter, was disappointed that no relief was offered to homebuyers. “The EMI moratorium has not been extended and there is no interest waiver. Project extensions have already been granted under RERA, so there has been no significant announcements for the sector today,” he said.
Madras Chamber of Commerce and Industry president Ramkumar Ramamoorthy, however, had a different view. He said that with banks becoming severely risk averse to lending and parking significant amounts with the RBI, the government creating an avenue for the surplus in the banking system to find its way into the economy by standing guarantee at 100% should enable MSMEs to kick-start their operations, thereby providing a pathway for them to take part in the development of a self-reliant India.
R. Ganapathi, president of the Southern India Chamber of Commerce and Industries, said that the decision to disallow tenders up to ₹200 crore in government procurement was path-breaking and was a step towards self-reliance. He said that it was a move in the right direction to support a modern India and ‘Make in India’.
