Lok Sabha Question No. 533 (UNSTARRED), answered on 2021-02-04
Subject: Restructuring of Sick MSMEs
Ministry: MICRO,SMALL AND MEDIUM ENTERPRISES
Asked by: B. Y. Raghavendra

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

## LOK SABHA

## UNSTARRED QUESTION NO. 533 TO BE ANSWERED ON 04.02.2021

## RESTRUCTURING OF SICK MSMEs

## 533.                SHRI B.Y.RAGHAVENDRA:

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

- (a) the  total  number  of  sick  Micro,  Small  and  Medium    Enterprises  (MSMEs)    in  the Country during the last three years;
- (b) whether the Reserve Bank  of India has appointed a special committee for restructuring the bank loan of sick MSMEs and if so, the details thereof;
- (c) the salient features of restructuring the bank loan of sick MSMEs; and
- (d) the  number  of  small  scale  industries  restructured  during  the  last  three  years, State/year and industry-wise;

## ANSWER

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

(a) to (d): The Reserve Bank of India has 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.  With  the  issuance  of  these Guidelines, the concept of sickness no longer exists.  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  latest  available  data  furnished  by  the  Reserve  Bank  of India, regarding revival and rehabilitation of MSMEs for the half year ended March, 2017 to half year ended March, 2020 is given in Annexure I.

Moreover,  with  a  view  to  facilitate  meaningful  restructuring  of  stressed  MSME accounts, RBI has permitted a one-time restructuring of loans to MSMEs subject to certain conditions. The restructuring of the MSME borrower account under the revised guidelines is  to  be  implemented  by  March  31,  2021  and  such  borrower  accounts  which  may  have slipped  into  NPA  category  between  March  2,  2020  and  date  of  implementation  may  be upgraded as 'standard asset', as on the date of implementation of the restructuring plan.

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## Annexure-I referred to in reply to part (a) to (d) of Lok Sabha Unstarred Question No. 533 for answer on 04.02.2021.

Data on Framework for Revival and Rehabilitation of MSME

(Accounts in Actual)

| SI. No.   | For the half year          | Accounts referred to the Committee during the half year   | Accounts resolved by the Committee during the half year (2)   | Corrective Action Plan by the Committee (out of 2)   | Corrective Action Plan by the Committee (out of 2)   | Corrective Action Plan by the Committee (out of 2)   |
|-----------|----------------------------|-----------------------------------------------------------|---------------------------------------------------------------|------------------------------------------------------|------------------------------------------------------|------------------------------------------------------|
|           |                            | (1)                                                       |                                                               | Rectification                                        | Restructuring                                        | Recovery                                             |
| 1         | October 2016- March 2017   | 100803                                                    | 137282                                                        | 80905                                                | 2197                                                 | 54180                                                |
| 2         | April 2017- September 2017 | 87062                                                     | 95107                                                         | 58512                                                | 207                                                  | 36388                                                |
| 3         | October 2017- March 2018   | 130208                                                    | 130473                                                        | 81492                                                | 1024                                                 | 47957                                                |
| 4         | April 2018- September 2018 | 150165                                                    | 123227                                                        | 76172                                                | 201                                                  | 46854                                                |
| 5         | October 2018 to March 2019 | 142275                                                    | 146519                                                        | 78737                                                | 15425                                                | 52357                                                |
| 6         | April 2019- September 2019 | 172949                                                    | 150613                                                        | 71203                                                | 14240                                                | 65170                                                |
| 7         | October 2019- March 2020   | 339728                                                    | 324621                                                        | 71938                                                | 148369                                               | 104314                                               |

Source: RBI

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