Amethi, May 13 (KNN) The MSMEs, which are on the verge of closure in Amethi, are disappointed with the politicians representing the region stating that despite being approached they have failed to solve the woes of the small entrepreneurs here.

The MSMEs have even expressed disappointment with the RBI for not taking any measures to solve the industry’s problems with the banks.

Indian Industries Association (IIA) Amethi Chapter Chairman Shanawaz Ahamad told KNN that they have approached RBI, MSME Ministry, Smriti Irani, Rahul Gandhi and other Central and State Government officials in this regard but nothing has been of help to them so far. He however praised the District Commissioner of Faizabad for supporting the MSMEs.

“There has been no response from any one. Neither Rahul Gandhi, nor Smriti Irani nor RBI,” Ahamad said.

“We are fighting at the RBI forum but nobody is listening to the MSMEs,” he said adding that even the Centre is not responding on this despite being approached.

The micro, small and medium enterprises (MSMEs) in Congress Vice President Rahul Gandhi’s constituency Amethi are facing huge financial crunch and have voiced concerns over closure of the units due to lack of support from the banks.

IIA highlighted that if the matter is not addressed immediately, it would lead to closure of more than 150 units in Jagdishpur Industrial Area.

IIA pointed that while recovery and auction should be the last option for the banks to recover their loans, in the area the banks consider that as their first option and send recovery/ auction notice to the units as soon as the unit turns NPA after 90 days of defaulting.

Out of 250 units in the hub, more than 80-90 units have already closed and 150 are on the verge of closure due to this.

IIA said that the banks there are charging exorbitantly high interest rates to the industries. “The interest rate for the agro-industries should be 1% but the banks here have charged some of the industries as high as 14-19 per cent interest rates.”

The problem is also non-release of working capital funds from the banks even after approval of loans, he added.

The industrialists had last month met Rahul Gandhi, Smriti Irani and even written a letter to PMO in this regard.

The MSME Ministry had last year notified the Framework for Revival and Rehabilitation of Sick Units. Recently, the Reserve Bank of India (RBI) had issued the Framework for Revival and Rehabilitation of Micro, Small and Medium Enterprises (MSMEs) along with operational instructions, to all banks for immediate implementation.

Under the Framework, cases for all MSME loan accounts where principal or loan instalments are overdue for 60 days or above are to be compulsorily placed before the district committee for stressed MSME assets for developing corrective action plan (CAP).

The Framework issued by the RBI is a much revised version of the identical notification issued by the Ministry of MSME way back in May, 2015, but  being issued by RBI is sacrosanct for the Banks. (KNN Bureau)