KASSIA appeals to Finance Minister to address MSME issues
Updated: Dec 05, 2013 01:06:02pm
Bengaluru, Dec 5 (KNN) Karnataka Small Scale Industries Association (KASSIA) has submitted a memorandum to the Finance Minister, P Chidambaram, seeking better credit flow, lower interest rates, among others.
The memorandum was submitted to the Finance Minister during the interactive session on Service Tax Voluntary Compliance Encouragement Scheme 2013, held here on December-4.
Commenting on the challenges faced by the MSME sector and the slowdown, “Credit flow, shortage of skill, delayed payment, inflation, power and other infrastructure deficiency have seriously hit the SSI sector. The degree of adversity is quite high and unless short term and long term measures are found, the significant growth picked up after the crisis of 2008, will get nullified,” President KASSIA, B P Shashidhar said.
“In order to introduce long term measures, a task force of the nature of PMs Task Force set up in 2008 may be commissioned to work out measures for averting further deterioration,” he added.
However, as a short term measure, KASSIA has recommended that certain emergency measures be implemented with immediate effect to ease the situation.
Among the suggestions are - the voluntary service tax scheme announced should not be made applicable to the MSE sector in the midst of the present credit crunch; all Nationalised Banks should institute an ad hoc scheme to support sick MSMEs; to loosen the tight supply of credit; 20 per cent of the limit sanctioned to be released immediately on request from the industry; and receivables due from PSU units to be excluded for the purpose of NPA classification.
KASSIA has also asked that a flat interest rate of 4 per cent be announced for a period of six months; for reduction of supplementary hidden charges for loan by 50 per cent; enhancing CGTMSE loan limit to Rs 1.5 crore; raising threshold limit for SARFASI action to Rs 1 crore; ensuring renewal of stuck up accounts for availability of funds without further loss of time; and review of the functioning of the CLCS Scheme for improvement. (KNN/ES)
The memorandum was submitted to the Finance Minister during the interactive session on Service Tax Voluntary Compliance Encouragement Scheme 2013, held here on December-4.
Commenting on the challenges faced by the MSME sector and the slowdown, “Credit flow, shortage of skill, delayed payment, inflation, power and other infrastructure deficiency have seriously hit the SSI sector. The degree of adversity is quite high and unless short term and long term measures are found, the significant growth picked up after the crisis of 2008, will get nullified,” President KASSIA, B P Shashidhar said.
“In order to introduce long term measures, a task force of the nature of PMs Task Force set up in 2008 may be commissioned to work out measures for averting further deterioration,” he added.
However, as a short term measure, KASSIA has recommended that certain emergency measures be implemented with immediate effect to ease the situation.
Among the suggestions are - the voluntary service tax scheme announced should not be made applicable to the MSE sector in the midst of the present credit crunch; all Nationalised Banks should institute an ad hoc scheme to support sick MSMEs; to loosen the tight supply of credit; 20 per cent of the limit sanctioned to be released immediately on request from the industry; and receivables due from PSU units to be excluded for the purpose of NPA classification.
KASSIA has also asked that a flat interest rate of 4 per cent be announced for a period of six months; for reduction of supplementary hidden charges for loan by 50 per cent; enhancing CGTMSE loan limit to Rs 1.5 crore; raising threshold limit for SARFASI action to Rs 1 crore; ensuring renewal of stuck up accounts for availability of funds without further loss of time; and review of the functioning of the CLCS Scheme for improvement. (KNN/ES)
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