The Hindu Business Line : Credit flow to small, medium units to double in 5 years, says PM

The Prime Minister, Dr Manmohan Singh, with the Minister for Micro, Small and Medium Enterprises, Mr Dinsha Patel; the Chairman and Managing Director of Bank of India, Mr Alok K. Misra; and the Chairman of State Bank of India, Mr O. P. Bhatt, during the National Awards Presentation to micro, small and medium enterprises in the Capital on Friday.

Our Bureau

New Delhi, Aug 28 The Prime Minister, Dr Manmohan Singh, said on Friday that the Government is committed to doubling the credit flow to micro, small and medium enterprises (MSMEs) within the next five years.

He added that the sector is an important component of the national economy as it provides employment to nearly 60 million people and contributes over 45 per cent of the total manufactured output and 40 per cent of the exports earnings.

Fiat to banks

Speaking at the National Awards ceremony for MSMEs, Dr Singh added that banks would be asked to ensure a higher flow of funds to these enterprises. Greater availability of credit can contribute to the faster modernisation and expansion of these enterprises, besides increasing their productivity and competitiveness, he said.

“I would also urge the MSMEs to explore new and emerging sources of finance like venture capital and private equity,” he said.

The Prime Minister further added that 2,000 clusters have been identified where the Government would help entrepreneurs get a one-stop access to facilities for capacity building, skill development, credit, marketing support and quality technology. In 500 out of these, such schemes have already been started by the Government, he said.

Task force

“I have met representatives of this sector two days back and have issued directions for setting up of a task force to look into the remaining difficulties being faced by the sector,” said Dr Singh.

He added that the next course of action to help the sector will be decided after three months, when the recommendations of the task force are made available.

Dr Singh also said that several recommendations of the National Commission for Enterprises in the Unorganised Sector have already been implemented and the remaining ones will be tended to very soon.

Competency programme

Speaking at the function, Mr Dinsha J Patel, Minister of State for MSMEs, said that to face the global competition and improve the capacity of the enterprises, the Ministry is implementing the National Manufacturing Competency Programme.

“For the 11th Plan, an amount of Rs 605 crore has been earmarked for this. Many programmes are being implemented under the public-private partnership route in order to attain global standards,” he said.

Mr Patel further added that during 2008-09 to 2011-12, an amount of Rs 4,735 crore has been earmarked under the Pradhan Mantri Employment Generation Programme (PMEGP). “This scheme would generate 37 lakh employment opportunities in rural and urban areas of the country,” he said.

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