Representational Image
Representational Image
Andrea Piacquadio

It is estimated that there has been a delay of payment worth Rs 1,819 crore to about 450 of CII’s MSME member companies, the industry body revealed. While public sector or government departments including state departments owe MSMEs Rs 1,709 crore, the private sector owes about Rs 110 crore to MSMEs, the survey added.

It showed that about 32 per cent of the outstanding to MSMEs have been delayed for more than two years and about Rs 895 crore are stuck in disputes. These need to be resolved soon to save the MSMEs from solvency, CII Director General Chandrajit Banerjee said.

Of the delayed payments amount, manufacturing contracts account for Rs 153 crore, services contracts account for Rs 723 crore and multiple sectors account for Rs 930 crore.

The CII suggested measures to alleviate the issue of pending payments to micro, small and medium enterprises (MSMEs) including tax refunds and incentives.

It said the government should monitor payment delays by CPSUs to MSMEs closely through a portal for complaints and ensure necessary funds are provided and utilised for this purpose.

Moreover, all PSUs and government departments both at the central and state-government levels must be encouraged or mandated to register themselves on TReDS platform.

Rs 1,819 crore of unpaid dues to MSME members: CII poll
CII survey

TReDS is an institutional mechanism set up in order to facilitate the trade receivable financing of MSMEs from corporate buyers through multiple financiers. In addition to overcome the delays in payments to MSMEs due to disputes all pending GST refunds should be cleared immediately, the chamber recommended.

It said all incentives due to MSMEs under various central and state schemes should be released immediately.

Banks should provide additional reconstruction term loans to MSMEs impacted by the lockdown, with the Government of India offering a guarantee up to 20 per cent of the default, CII said.

Finance Minister Nirmala Sitharaman on May 13 had announced that CPSEs and the government would clear payments of MSMEs in 45 days to improve their liquidity.

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