Union Finance Minister Nirmala Sitharaman reaffirmed the government's commitment to ensuring that Micro, Small and Medium Enterprises (MSMEs) receive their outstanding payments within the 45-day deadline set by the government.
On Monday July, 26, 2021, she stated the above while responding to a question about the issue in the Lok Sabha.
"I reviewed it over the last year (2020) from the perspective of central government and various departments that owe money to MSMEs, including public sector undertakings (PSUs). We have ensured that the 45-day rule is not broken and that all dues are paid to MSMEs from the government side, "Sitharaman explained.
The minister went on to say that the government is actively encouraging the development of a digital platform where MSMEs' payments can be discounted.
"As far as the central government is concerned, we have taken the position that any pending payment must be made within 45 days, and I am personally monitoring it," Sitharaman said.
When it comes to Goods and Services Tax (GST) payments, the finance minister stated that the GST Council will have the final say. "The GST Council will have to respond on how they want the states to participate in this scheme of things. When we say government dues, we mean not only central government or central PSU dues, but also state government and state government-owned PSU dues," Sitharaman explained.
MSMEs play an important role in nation-building and economic growth. They account for approximately 29% of the country's GDP and employ more than 11 million people.
As of July 2, 2021, this year, around Rs. 1.09 crore MSME borrowers had received guarantee support totaling 2.73 lakh crore under the Emergency Credit Line Guarantee Scheme (ECLGS), MSME minister Narayan Rane said in the Rajya Sabha last week.
Rane announced on Thursday July 22, 2021, that public sector banks had restructured MSME loan accounts totaling Rs. 55,333 crores by June 25, 2021, of this year.
In a separate response, he stated that since the inception of the Prime Minister's Employment Generation Programme until (July 9, 2021) 6,97,612 units (including those set up by farmers) have been established with MM (margin money) subsidies totaling Rs. 16,688.17 crores.