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Business EconomyPosted at: Jun 17 2021 9:08PM


Telangana govt urges Centre to make Aatmanirbhar relief package more realistically, humanly for most affected constituents

Hyderabad, Jun 17 (UNI) : Telangana Government on Thursday requested the central government to do a sincere reappraisal of the ‘ Aatmanirbhar relief package’ and make it work more realistically and humanly for the most affected constituents, of which MSMEs occupy a top priority.
In a letter addressed to Union Minister of Finance Nirmala Sitharaman, Telangana Industries Minister K T Rama Rao assured that if the Government of India takes the right steps in this direction, states will certainly follow suit and match GOI’s efforts which are their own.
He requested the Finance Minister to take his concerns on board and strive to meet our expectations.
He said it is now over a year since Prime Minister Narendra Modi announced the Aatmanirbhar relief package of Rs 20 lakh crore for all the sectors adversely impacted by Covid.
However, one year down the line, “ I regret to mention that the impact of the package has been ‘minimal’ on this MSMEs sector, the backbone of the manufacturing sector in the state, that has really faced the brunt of the pandemic, '' the Minister said.
More than 80 per cent of the MSMEs in the state have faced a negative impact mainly due to the heavy lockdown of last year and above 25 percent have lost significant revenues, he said that the most touted and directly targeted scheme for the MSME sector in the package is the Guaranteed Emergency Credit Line Scheme under which Rs 3 lakh crore were allotted.
However in Telangana at least, the MSME units themselves did not find anything specifically attractive in the scheme, he pointed out and said in hindsight, it appears that the scheme has been designed with the sole principle of making its administration simple.
Every MSME has unique challenges and a “ One Size fits all” kind of scheme hardly is the answer to their requirements.
What will really work is a solid financial grant that takes care of all the losses the MSMEs have suffered due to the pandemic, he questioned and said that actual ground challenges that the manufacturing MSMEs continue to face even today include supply chain disruptions, severe shortage of labour and in some cases, a complete disruption in their customers preferences.
There are two other schemes also targeted at the MSMEs in the Aatmanirbhar relief package and one of them is meant for stressed MSMEs and the other one is for innovative MSMEs, the Minister said in the letter.
Unfortunately, these two have been complete ‘non-starters’ not just in Telangana , but as data reveals, in the entire country, Mr Rao said.
The Subordinate Debt Scheme for stressed MSMEs offers every meager loan amount and has an impractical requirement of establishing commercial viability of the unit before sanctioning the loan, which seems very impractical during a time of uncertainty where no one can ever be sure of viability based on risk assessment.
The guidelines of the Corpus Fund Scheme meant for innovative MSMEs have not been released so far, he said.
Another component of the Aatmanirbhar relief package which could have potentially impacted the MSMEs positively is the PLI scheme offered in different champion sectors, he said in its present form, is evident that the scheme will only benefit large manufacturing companies.
A simple tweak in the scheme guidelines that can benefit the MSMEs enormously could be to mandate the large manufacturing companies to set up a supply chain of domestic MSMEs and share the PLI benefits with each of them proportionately, said Mr Rao.
When the Aatmanirbhar relief package was announced in May last year, we had all hoped that the pandemic will be short-lived, and therefore the package, however imperfect it may be, will suffice.
But now we know that the pandemic continues through the second wave and can possibly see a third wave also any time soon.
It is high time that we do a sincere reappraisal of the Aatmanirbhar relief package and make it work more realistically and humanly for the most affected constituents, of which MSMEs occupy a top priority, he added.
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