Union Minister Nitin Gadkari stated that the industry has been asked to release payments because of the micro, small and medium enterprises in the country.
Members of FICCI were addressed with the help of video conferencing where Gadkari said that this step would ensure liquidity. All of the MSMEs must be safeguard during this outbreak of COVID-19.
The minister for road transport and highways and MSMEs, Gadkari stated that work by the National Highways Authority of India is going on for fast-tracking arbitration cases, which will play a major role in injecting the liquidity into the market.
On Tuesday Gadkari made a statement that ministry has made several definitive plans to ensure clearing of all legitimate claims more or less within three months.
He added on to it that growing the scale of infrastructure projects by at least two to three times will help boost up the economic activity in the country.
The MSME ministry came up with the decision that section 7 of the Micro, Small and Medium Enterprises Development Act, 2006 will be corrected to outline units that are producing goods and providing services in terms of annual turnover.
Gadkari said, “For instance where Japan and U.S. are looking forward to move their investments out of China and set up industries in different location, India is the only nation which can plan well to take an advantage out of this situation.
Loans given to MSMEs have been assured by paying a premium of around 1.5 percent to banks on loans amounting to a total of Rs 1 lakh crore and taken 75 percent assurance while the banks have to bear with only 25 percent of the collateral.
Obviously, we are working best with different plans to reduce the limit of collateral. The finance ministry would be asked to limit the quantum of loans would witness increase to Rs 5 lakh crore from Rs 1 lakh crore, so that it becomes comparatively easier for MSMEs to avail credit.