ASSOCHAM urges government to provide relief package for MSMEs to tide over COVID-19

Industry body ASSOCHAM has demanded from the government a “concentrated and right kind” of relief package for MSME sector, which has been most affected by COVID-19 pandemic. 

“Yes, there is a need for a relief package which has to be directed very carefully. We at ASSOCHAM believe that both the Centre and the States need to come together with certain plans, so that we can give a concentrated, focused and the right kind of relief to whoever needs it the most,” ASSOCHAM President Vineet Agarwal has said. 

Suggesting some measures, Mr Agarwal has added that banks should increase working capital limit of MSMEs by 20 per cent but not charge any extra collateral. Secondly, reclassification of NPAs of MSMEs should be done, Mr Agarwal has said. 

Thirdly, street vendors and small shopkeepers should be provided with some sort of relief, direct benefit or working capital loan, he has added. As last time some relief measures were taken specifically for the rural sector, a similar step once again should be taken, the ASSOCHAM president has said. 

“Certainly, there is a need for some kind of impetus at various levels, and definitely more at the MSME level,” said Mr Agarwal, who is also the managing director of Transport Corporation of India (TCIL). 

On the impact of the second wave of the COVID-19 pandemic on the economy, he has said: “As we saw during the first wave as well, the larger companies were able to come out of it much faster. We are seeing that MSMEs are facing a brunt of issues now. So, many of them are facing demand cuts. Some of them are not receiving their payments on time.” 

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