Finance Minister Nirmala Sitharaman has told the Lok Sabha that the government will clear dues owed to Micro, Small and Medium Enterprises (MSMEs) within 45 days.
The Central Government has taken this position that any pending payment to MSMEs will have to be given in 45 days and I am personally monitoring it, Nirmala Sitharaman said while replying to a question on Govt dues to MSMEs during the Question Hour in the Lok Sabha today.
The Central Government has taken this position that any pending payment to MSMEs will have to be given in 45 days and I am personally monitoring it: Smt @nsitharaman answers a question on Govt dues to MSMEs during the Question Hour in the Lok Sabha today@FinMinIndia pic.twitter.com/MzO1IlMEeq
— NSitharamanOffice (@nsitharamanoffc) July 26, 2021
MSMEs have been deeply impacted amid the COVID-19 pandemic. Pendency in bill payment has been one of the issues the sector has been raising ever since the onset of the pandemic.
The industry estimates that Rs 5 lakh crore is due from central and state governments as well as public sector units.
It may be noted that the government as well as the Reserve Bank of India have taken a number of steps in the last one year to handhold MSMEs since the onset of the pandemic. The government announced Rs 3 lakh crore emergency credit line guarantee scheme (ECLGS) as part of the Rs 20 lakh crore COVID-19 stimulus announced by Prime Minister Narendra Modi in May last year.
Micro, Small and Medium Enterprises (MSMEs) popularly called MSMEs are the backbone of the Indian economy.
These small economic engines have a huge impact on the country’s GDP-making a contribution of 29 per cent. They contribute to almost half of exports from the country. Additionally, more than 11 crore people are employed in the MSME sector.
Many economists and experts have suggested the government to resort to printing more currency notes to support the economy ravaged by the spread of COVID-19, and protect jobs.
India’s real Gross Domestic Product (GDP) is estimated to have contracted by 7.3 per cent during 2020-21, Sitharaman said in a written reply to Lok Sabha.
This contraction reflects the unparalleled effect of the pandemic and the containment measures that were taken to control the pandemic, she said.