Finance package to save MSMEs soon: RBI

New Delhi, Nov 25: The Reserve Bank of India (RBI) is expected to announce a financing package for the Micro, Small and Medium Enterprises (MSMEs), as the sector has been facing credit crunch due to delay in payments and unwillingness on the part of Banks towards offering loans in the backdrop of current global financial scenario, said Dinesh Rai, Secretary, Ministry of MSME, Government of India. He was speaking at the India Global Summit on MSMEs 2008, jointly organized on Tuesday, Nov 25 by the Ministry of Micro, Small and Medium Enterprises, Government of India and Confederation of Indian Industry (CII).

"Sending affirmative signals, the Government of India has also appointed a committee of secretaries to look at the problems being faced by the MSME sector, which include arenas of skills development, clusters approach, credit availability, technical and market considerations. Integrating the sector with global players is also of immense importance for the holistic development of India", he further added. Towards the endeavors undertaken by the government are the enactment of MSME act 2006, Prime Minister's Employment Generation Program for generating 37 lakh jobs under the eleventh plan, setting up of National Commission for enterprises in Organized sector, skills development planning commission amongst others.

Strongly indicating the development of MSMEs and reflecting a longstanding relationship with National Small Industries Corporation (NSIC), CII and NSIC also signed a Memorandum of Understanding (MoU) at the occasion. The MoU addresses long-term strategic domain of the sector, which includes points on exposing, offering necessary assistance like joint participation in missions, programs, organization of exhibitions and facilitating technology transfer amongst others.

The event also marked the release of a study done with Indian MSMEs in the B2B domain, named CII - StrategiCom: Benefits of a Strong Brand. The study sets out to explore and measure the benefits of a transforming traditional family owned enterprises into a strong brand in the Indian context. Bernd Mutzelburg, Ambassador, Embassy of Federal Republic of Germany, said, "fundamentals of Indian economy are very strong and this is the time that world should look up to India to mitigate the current global crisis. We need a stimulus package for the industry. The potential of MSMEs in India has been recognized. This sector is most flexible and willing to change, with its innovative and cost effective methodologies. The sector needs to focus on infrastructure and technological aspects of the economy."

Understanding the current crisis as a mode of bringing opportunities for the sector, Mr. Subodh Bhargava, Past President, CII and Chairman, Tata Communications Limited spoke about affirmative actions for the MSMEs in Asia and Africa to be leveraged at this point in time. He stated, "more than 50 of the MSMEs are operating out of rural areas. MSMEs have to evolve as global enterprises in future. Many of us are yet to understand the dynamics of operating abroad. Greater participation on understanding the technical, financial and market nuances will be helpful for a futuristic global approach."

ANI