Dehradoon, Apr 26 (KNN) The national industry body, Associated Chamber of Commerce and Industry of India (ASSOCHAM) has sought the creation of a Rs 1,000 crore fund to help micro, small and medium enterprises (MSMEs) in Uttarakhand to access affordable credit, vital for their survival in difficult business conditions.

Batting for the credit policy for SMEs in the state at the ASSOCHAM 7th SME Sammelan “Banking and Finance Solutions for Sustainable Growth” in Dehradun yesterday, ASSOCHAM’s General Secretary D S Rawat demanded the creation of a Rs 1,000 crore fund exclusively for SMEs to drag them out of the red. 

"Twenty five per cent of small and medium enterprises in Uttarakhand have shut shop due to absence of proper incentives from the government,” Rawat said.

"If the state government does not want any more SMEs to down shutters, it will have to create a fund of Rs 1,000 crore as a mechanism to provide affordable finances to the SMEs," he added.

He recommended that the state government establish a special cell led by the chief minister or chief secretary to help the sector which employs about 2.5 lakh skilled and unskilled people.  He also suggested that the state immediately setup 10 e-clusters for auto and auto parts, food processing, herbals, garments and handicrafts. 

ASSOCHAM offered to extend help in terms of expertise to help the state to develop e-clusters on public-private-partnership (PPP) mode.

Each cluster will house more than 200 units and provide jobs to more than 1.5 lakhs people directly or indirectly.

Expressing concern over the issues faced by SMEs in the state, Rawat said, “If the state government does not wake up now to the plight of SMEs in Uttarakhand, it would be too late.” 

Meanwhile, Principal Secretary, Small Scale Industries, Government of Uttarakhand  Ranbir Singh stated that a separate department for SMEs was being established, assuring that a separate law was in place to safe guard the interest of the sector.

“To promote the small scale industries, the State of Uttarakhand is finalizing the public procurement policy to provide performance in purchase as well as price from this sector” a media report said quoting Dr Ranbir Singh while addressing the Sammelan.

Further, SME Council Chairman P K Jain also raised the issue of non-availability of credit to the SMEs which he emphasised was a key input for the sustained growth of the small scale sector. 

Addressing the conference, Jain said, “Despite their economic significance, SMEs face a number of bottlenecks that prevent them from achieving their full potential.” 

SMEs play a vital role in the country’s economy.  Yet they face major problems like inability to access timely and adequate finance, lack of infrastructure and multiple regulating agencies. 

“The infrastructural facilities for SMEs in India have not reached the desired level restricting private initiatives,” Jain said, adding that creation of better infrastructural facilities for SMEs must receive greater priority. 

Multiple regulating agencies lead to harassment and inspections with greater impact on operations of SMEs than on larger units, he said.

Describing SMEs as the key drivers of the Indian economy, Jain said if the country has to achieve double digit growth, it is important to extend the much needed infrastructure and finance to enable them to bolster the Indian economy and foreign trade. 

However, Jain acknowledged the banks for starting dedicated SMEs cells to extend support to them and make them globally competitive in terms of product quality, marketing strategy and product positioning. (KNN)