Lok Sabha Question No. 691 (UNSTARRED), answered on 2020-09-17
Subject: Stressed Small and Micro Companies during COVID-19 in Tamil Nadu
Ministry: MICRO,SMALL AND MEDIUM ENTERPRISES
Asked by: V. Kalanidhi

## GOVERNMENT OF INDIA

## MINISTRY OF MICRO, SMALL AND MEDIUM ENTERPRISES

## LOK SABHA UNSTARRED QUESTION No. 691

TO BE ANSWERED ON 17.09.2020

## STRESSED SMALL AND MICRO COMPANIES DURING COVID-19 IN TAMIL NADU

## 691. DR. KALANIDHI VEERASWAMY:

Will  the  Minister  of  MICRO,  SMALL  AND  MEDIUM  ENTERPRISES  be pleased to state:

- (a) the details of the number of stressed small and micro companies during the period of COVID-19 within Tamil Nadu;
- (b) the details of the number of small companies declared bankrupt during the period of COVID-19 within Tamil Nadu; and
- (c) the steps being taken by the Government for their revival?

## ANSWER

## MINISTER OF MICRO, SMALL AND MEDIUM ENTERPRISES (SHRI  NITIN GADKARI)

- (a): The  Reserve  Bank  of  India  issued  guidelines  on  'Framework  for  Revival  and Rehabilitation  of  Micro,  Small  and  Medium  Enterprises'  to  Scheduled  Commercial  Banks (excluding Regional Rural Banks) in March 2016.  Under this Framework, banks have been advised  to  identify  incipient  stress  in  the  MSME  accounts  and  refer  it  to  the  Committees formed  under  the  framework  for  Corrective  Action  Plan  for  rectification,  restructuring  and recovery.  The  number  Accounts  referred  to  the  Committee  and  Accounts  resolved  by  the committee for the half year ended March, 2017 to half year ended March, 2020 are:

|       |                            | TotalMSME                                               | TotalMSME                                               |
|-------|----------------------------|---------------------------------------------------------|---------------------------------------------------------|
| S No. | For the half year          | Accounts referred to the Committee during the half year | Accounts resolved by the Committee during the half year |
| 1     | October 2016- March 2017   | 1,00,803                                                | 1,37,282                                                |
| 2     | April 2017- September 2017 | 87,062                                                  | 95,107                                                  |
| 3     | November 2017-March 2018   | 1,30,208                                                | 1,30,473                                                |
| 4     | April 2018-September 2018  | 1,50,165                                                | 1,23,227                                                |
| 5     | November 2018-March 2019   | 1,42,275                                                | 1,46,519                                                |
| 6     | April 2019-September 2019  | 1,72,949                                                | 1,50,613                                                |
| 7.    | October 2019-March 2020    | 3,39,728                                                | 3,24,621                                                |

Source: RBI

Note:  Number of  cases resolved by the  committees is  more  than  the  cases  referred  due  to some pending cases with the committees at the beginning of the half year which have been resolved during the period.

(b): As  per  the  ownership  classification,  most  of  the  MSMEs  are  either  operating  as proprietorship or partnership firms. Therefore the clause of bankruptcy does not apply to such firms.  In case of registered companies, it has already been notified by the Ministry of Law & Justice  on  05.06.2020  that  no  application  for  initiation  of  corporate  insolvency  resolution process of a corporate debtor shall be filed, for any default arising on or after 25.03.2020 for a period of six months or such further period, not exceeding one year from such date as may be notified in this behalf.

(c): The Ministry of MSME implements various schemes and programmes for growth and development  of  MSME  Sector  in  the  country  including  Tamil  Nadu.  These  schemes  and programmes  include  Prime  Minister's  Employment  Generation  programme  (PMEGP), Scheme  of  Fund  for  Regeneration  of  Traditional  Industries  (SFURTI),  A  Scheme  for Promoting  Innovation,  Rural  Industry  &  Entrepreneurship  (ASPIRE),  Interest  Subvention Scheme for Incremental Credit to MSMEs, Credit Guarantee Scheme for Micro and Small Enterprises,  Micro  and  Small  Enterprises  Cluster  Development  Programme  (MSE-CDP), Credit Linked Capital Subsidy  and Technology Upgradation Scheme (CLCS-TUS).

Recently, Post Covid-19, Government has taken a number of initiatives under Aatma Nirbhar Bharat Abhiyan to support the MSME Sector in the country especially in Covid-19 pandemic. Some of them are:

- i) Rs 20,000 crore Subordinate Debt for MSMEs.
2. ii)   Rs. 3 lakh crores Collateral free Automatic Loans for business, including MSMEs.
3. iii)   Rs. 50,000 crore equity infusion through MSME Fund of Funds.
4. iv)   New revised criteria for classification of MSMEs.
- v) New  Registration  of  MSMEs  through  'Udyam  Registration'  for  Ease  of  Doing Business.
6. vi)   No global tenders for procurement up to Rs. 200 crores, this will help MSME.

An online Portal 'Champions' has been launched on 01.06.2020 by Hon'ble Prime Minister.  This  covers  many  aspects  of  e-governance  including  grievance  redressal  and handholding  of  MSMEs.  Through  the  portal,  total  19,235  grievances  have  been  redressed upto  14.09.2020.  RBI  has  also  announced  several  measures  to  Reduce  Financial  Stress  of MSMEs.

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