Considering an easier access to credit is paramount to growth of any small business, the Micro, Small and Medium Enterprises (MSME) Ministry is in the process of holding consultations with various banks, both in private and public sector to persuade them for improving flow of credit to MSME sector.
Minister of State for MSME sector K H Muniyappa said that the major factors affecting growth of the sector include marketing problems, shortage of raw-material, working capital, lack of demand, power crunch and labour issues. Therefore, there is a need to make these units more competitive by enhancing the availability of institutional credit, providing adequate infrastructure, meeting demands for skill development and strengthening marketing support.
The sector contributes around 8% of the country's GDP, 45% of the manufactured output and provides employment to over 8 crore people engaged in over 3.6 crore units, producing more than 6,000 products.
Meanwhile, the government has been taking steps to boost the sector’s growth. In the 12th Five-Year Plan, the Budget allocation for the sector has been more than doubled to Rs 24,000 crore from Rs 11,000 crore in the last five plan period. Further, it has also set up a six-member inter-ministerial panel, which will suggest measures to boost the MSME exports.
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