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Ailing MSME sector is in dire need of State support?

15 industrial associations stage a protest with various demands

In a bid to save the bleeding micro, small and medium enterprises in the country, the Central and State governments should step and help the MSME sector in a big way immediately - with this prime demand, members and office-bearers of over 15 industrial associations, led by Madurai District Tiny and Small Scale Industries Association (MADITSSIA), staged a demonstration, joining the nationwide protest, in front of the Madurai Collectorate on Monday.

Apprehending tough actions by financial institutions, a majority of the small and tiny units were functioning at a loss. “If we locked our units, the banks may take legal action and proceed with auction. Hence, in a bid to prevent such a situation, many units, despite bleeding, are functioning,” MADITSSIA president M. S. Sampath said.

“When prices of raw materials such as iron, steel and aluminium were not rising frequently, why is it that there is a steep rise in finished products. The Centre must look into why within a short span, prices of essential building materials had risen three to four times. Public sector undertakings such as National Small Industries Corporation (NSIC) and Small Industries Development Corporaation (SIDCO) must play a catalystic role in resuscitating the sector,” he said.

On the lines of land bank, materials bank could be established to serve the MSME sector so that the industrial units could get raw materials at a fair price and also avoid middlemen.

 

The Centre must keep a check on rise in prices of raw materials as, for instance, the price of raw materials for plastic had risen by 76%. This had resulted in closure of most of the small and cottage units. The entrepreneurs had to infuse working capital by borrowing money at high inerest rates. Either the government should help in supplying raw materials at affordable rates or give relief through banks. The EMIs should be re-worked and it must be ensured that the units had adequate working capital, RM Lakshminarayanan, secretary of MADITSSIA, said.