Lok Sabha Question No. 4081 (UNSTARRED), answered on 2019-12-12
Subject: Effect of Economic Slowdown on MSMEs
Ministry: MICRO,SMALL AND MEDIUM ENTERPRISES
Asked by: Ajay Nishad

## GOVERNMENT OF INDIA MINISTRY OF MICRO, SMALL AND MEDIUM ENTERPRISES

## LOK SABHA UNSTARRED QUESTION No. †4081 TO BE ANSWERED ON 12.12.2019

## EFFECT OF ECONOMIC SLOWDOWN ON MSMEs

## †4081. SHRI AJAY NISHAD:

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

- (a) the contribution of Micro, Small and Medium Enterprises in the National Market;
- (b) whether  many  Micro,  Small  and  Medium  Scale  Industries  have  been  affected  due  to  recent global economic downturn and at the same time, these enterprises have the misfortune of reformist steps like demonetization and GST;
- (c) if so, the details of the decrease in income and exports and number of units have been closed so far ;
- (d) whether these industries are facing a threat due to the entry of multinational companies in the country;
- (e) if so, whether the Government is searching for any success formula to enable such industries to compete in fiercely competitive world markets and if so, the details thereof; and
- (f) whether  the  Government  has  given  any  incentive  package  to  these  industries  and  if  so,  the details thereof?

## ANSWER

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

(a) to (c): As per National Statistical Office, Ministry of Statistics & Programme Implementation, Share of MSME sector in All India Gross Domestic Product (GDP) during 2017-18 has been 29.7%. As reported by Directorate General of Commercial Intelligence and Statistics (DGCIS), the share of MSME related products in total exports during 2018-19 has been 48.10%.

The impact of global economic downturn on MSMEs is cyclic in nature. As per the preliminary assessment report on the impact of demonetization brought out by the RBI, the adverse impact had been transient.

Under the 'Framework for Revival and Rehabilitation of Micro, Small and Medium Enterprises' issued  by  Reserve  Bank  of  India,  banks  have  been  advised  to  identify  incipient  stress  in  the  MSME accounts  and  refer  it  to  the  Committees  formed  under  the  Framework  for  suitable  Corrective  Action Plan viz. rectification, restructuring and recovery. As per the information received from Reserve Bank of India, stressed accounts referred to the Corrective Action Plan Committee during the half year ended March 2019 is 1,42,275.

(d) & (e): In  order  to  enhance  competitiveness,  marketability  and  technology  upgradation  of products/services of MSMEs in the global market, the Government has taken several measures under various programmes/Schemes.

(f): The Ministry of MSME implements various programmes to support promotion & development of  MSMEs.  These  include  Financial  Support  to  MSMEs  in  ZED  Certification  Scheme,  Marketing Assistance  and  Technology  Upgradation  Programme,  Procurement  and  Marketing  Support  Scheme, Micro and Small Enterprises-Cluster  Development  Programme  (MSE-CDP),  Tool  Rooms  and Technology  Centers,  Entrepreneurship  Skill  Development  Programme  (ESDP),  Credit  Guarantee Scheme for Micro and Small Enterprises (MSEs), Building Awareness on Intellectual Property Rights" (IPR)  for  the  Micro,  Small  &  Medium  Enterprises  (MSME)  and  Credit  Linked  Capital  Subsidy  and Technology Upgradation Scheme (CLCS-TUS).