EDITIONS
Report

Sick Micro, Small and Medium Enterprises in Country

Team YS
posted on 17th November 2010
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As per the data compiled by the Reserve Bank of India (RBI) from the scheduled commercial banks, there were 77,723 sick micro and small enterprises (MSEs) in the country as at the end of March 2010. Information in respect of medium enterprises is not being collated by the RBI. As per the quick results of Fourth All India Census of Micro, Small and Medium Enterprises (MSMEs) for the reference year 2006-07, of the total MSMEs registered/entrepreneurs memorandum filed up to 31st March 2007, 4,80,946 enterprises were found closed. The State-wise position of sick MSEs and closed MSMEs is given at Annexure.  The main reasons for sickness/closure are inadequate and delayed credit, obsolete technology, marketing problems, infrastructural constraints, managerial deficiencies, etc.

Financial assistance, by way of debt restructuring, including fresh loans, for the rehabilitation of sick MSE is provided by the primary lending institutions (PLIs), including commercial banks, which provide credit to the MSEs. For this purpose, the RBI has issued detailed guidelines to banks in January 2002 on detection of sickness in MSE at an early stage and taking remedial measures and for rehabilitation of sick MSEs identified as potentially viable. RBI has also issued guidelines on 8th September 2005 on debt restructuring mechanism for small and medium enterprises (SMEs) which relate, inter alia, to viability criteria, prudential norms for restructured accounts, provision of additional finance and time frame for working out the restructuring package and its implementation.  Further, the RBI has advised all scheduled commercial banks on May 4, 2009 to apply the RBI’s guidelines on debt restructuring optimally and in letter and spirit and put in place their own non-discretionary one-time settlement (OTS) policy for the MSE sector.  The Ministry of Micro, Small and Medium Enterprises (MSME) is implementing various schemes/programmes across the country for the promotion and development of MSMEs, including generation of employment opportunities for people including those affected by closure of units. The major schemes, inter alia, include Prime Minister’s Employment Generation Programme, National Manufacturing Competitiveness Programme, Cluster Development Programme, Credit Guarantee Scheme, Credit Linked Capital Subsidy Scheme, Performance and Credit Rating Scheme and Market Development Assistance Scheme.

State/Union Territory-wise number of sick MSEs as at the end of March 2010 and closed MSMEs as per the quick results of Fourth All India Census of MSMEs for the reference year 2006-07

Sl. No.

Name of State/UT

Number of sick MSEs(as at the end of March, 2010)

No. of MSMEs found closed

01.

Jammu & Kashmir

2409

2313

02.

Himachal Pradesh

341

3883

03.

Punjab

2236

22072

04.

Chandigarh

50

513

05.

Uttarakhand

756

7485

06.

Haryana

1060

10655

07.

Delhi

1370

408

08.

Rajasthan

3684

15950

09.

Uttar Pradesh

7217

75659

10.

Bihar

2205

15136

11.

Sikkim

61

86

12.

Arunachal Pradesh

-

167

13.

Nagaland

12

2256

14.

Manipur

31

929

15.

Mizoram

3

657

16.

Tripura

288

412

17

Meghalaya

13

665

18.

Assam

1027

5919

19.

West Bengal

16853

8881

20.

Jharkhand

1816

4577

21.

Orissa

3063

5310

22.

Chhattisgarh

1253

15088

23.

Madhya Pradesh

2760

35082

24.

Gujarat

4366

33228

25.

Daman & Diu

45

789

26.

Dadra & Nagar Haveli

2

1309

27.

Maharashtra

6348

37525

28.

Andhra Pradesh

3028

13370

29.

Karnataka

5331

42315

30.

Goa

81

3224

31.

Lakshadweep

-

25

32.

Kerala

5078

34418

33.

Tamil Nadu

4827

79778

34.

Puducherry

71

621

35.

Andaman & Nicobar

38

241

All-India

77723

480946

This information was given by the Minister of State (Independent Charge) for Micro, Small and Medium Enterprises, Shri Dinsha Patel in a written reply to a question in the Lok Sabha .

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