Lok Sabha Question No. 1097 (UNSTARRED), answered on 2023-07-26
Subject: Financial Crisis in Industries
Ministry: COMMERCE AND INDUSTRY
Asked by: Shiromani Ram

## GOVERNMENT OF INDIA MINISTRY OF COMMERCE & INDUSTRY DEPARTMENT FOR PROMOTION OF INDUSTRY AND INTERNAL TRADE

## LOK SABHA

UNSTARRED QUESTION NO. 1097.

TO BE ANSWERED ON WEDNESDAY, THE 26 TH  JULY, 2023.

## FINANCIAL CRISIS IN INDUSTRIES

## 1097.  SHRI RAMSHIROMANI VERMA:

Will the Minister of COMMERCE AND INDUSTRY be pleased to state: वाणिज्य एवं उद्योग मंत्री

- (a) whether the Government is aware of the financial crisis faced by industries in some sectors and if so, the details thereof;
- (b) whether the Government is also aware of the closure of industries in some sectors and if so, the details thereof;
- (c) whether the Government has identified the reasons responsible for the above issues;
- (d) if so, whether the Government has conducted any study in this regard; and
- (e) the corrective measures being taken by the Government in this direction?

## ANSWER

## वाणिज्य एवं उद्योग मंत्रालय में राज्य मंत्री ( श्री सोम प्रकाश ) THE MINISTER OF STATE IN THE MINISTRY OF COMMERCE & INDUSTRY (SHRI SOM PARKASH)

- (a) to (e): Promotion  of  industrial  growth  is  a  continuous  and  ongoing  effort  and  regular feedback  is  taken  from  multiple  stakeholders  as  part  of  this  exercise.  The industrial growth process is accompanied by the formation of new enterprises and closure  of  old  ones  due  to  several  factors  such  as  innovation,  upgradation  of technology, changes  in  production  line,  changes  in  demand  pattern,  etc  in response to the prevailing socio-economic conditions.

Government has undertaken various steps to boost industrial performance. These include introduction of Goods and Services Tax, reduction in Corporate tax rate, interventions  to  improve  ease  of  doing  business,  measures  for  reduction  in compliance burden, policy measures to boost domestic manufacturing through public   procurement orders, Phased Manufacturing Programme (PMP), FDI policy reforms, etc.

The  series  of  measures  taken  by  the  Government  to  improve  the  economic situation and convert the disruption caused by COVID 19 into an opportunity for growth includes Atmanirbhar  packages,  introduction of Production Linked Incentive (PLI) Scheme across fourteen sectors to augment the manufacturing capacity,  investment  opportunities  under  National  Infrastructure  Pipeline  (NIP) and National Monetisation Pipeline (NMP), soft launch of National Single Window System (NSWS), etc. An institutional mechanism to fast- track investments has been  put  in  place,  in  the  form  of  Project  Development  Cells  (PDCs)  in  all concerned Ministries/ Departments of Government of India.

The  Emergency  Credit  Line  Guarantee  Scheme  (ECLGS)  for  industry,  with provision of Rs 3 lakh crore which has now been increased to Rs. 5 lakh crore, is in  the  form  of  a  fully  guaranteed  emergency  credit  line  to  lending  institutions. Financial  support  has  been  given  to  the  stressed  MSMEs  with  infusion  of Rs.20,000 crore equity support through Subordinate Debt. Fund of Funds has been  created  to  infuse  equity  worth  Rs.50,000  crore  in  the  MSME  Sector  by setting up Rs.10,000 crore Corpus Fund. Also, Government is ensuring timely payment to the MSMEs by          instructing all Government of India and CPSEs to clear all receivables of MSMEs within 45 days. Procurement from domestic companies is  being  encouraged  by  disallowing  global  tender  in  government  procurement tenders upto Rs 200 crore. In additional initiatives like Self-Reliant India Fund, Private  Equity/Venture Capital  funds,  New  revised  criteria  for  classification  of MSMEs, New Registration of MSMEs through 'Udyam Registration' for Ease of Doing Business, launching of an online  portal 'Champions', launch of Udyam Assist  Platform  (UAP)  are  to  support  different  sectors  of  MSMEs  across  the country. In the Union Budget 2023- 24, an amount of Rs 9000 crore was infused in the corpus of revamped Credit Guarantee Scheme for MSEs, effective from 1st April, 2023. This is to enable additional collateral-free guaranteed credit of Rs 2 lakh crore.

Government  has  also  focused  on  infrastructure  development.  PM  Gati  ShaktiNational Master Plan & Logistics Policy facilitate development of infrastructure and last  mile  connectivity  to  reduce  the  logistic  cost  and  increase  the  efficiency  of economy. Capital investment outlay in the Budget has increased by almost 3 times from Rs. 3.39 lakh crore in 2019-20 to Rs. 10 lakh crore in 2023-24.

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