India / Sonia writes to PM, suggests 5 steps to help MSMEs amid COVID-19 crisis

New Delhi: Congress President Sonia Gandhi has written to Prime Minister Narendra Modi on the current situation of the economy and stated that the government should take measures to ensure revival and strengthening of MSMEs (Micro, Small and Medium Enterprises). She also suggested five concrete ideas for redressal, the Congress party said on Saturday, 25 April, as per ANI.

One of the ideas being announcement of a Rs 1 lakh crore ‘MSME Wage Protection’ package. While the second idea is to establish and deploy a credit guarantee fund of Rs 1 lakh crore.

The third step suggested by the Congress leader mentions that the actions taken by the RBI “must get reflected in actions by commercial banks” so that timely credit supply is ensured to the MSMEs.

Further, she recommended that the government should set up a 24X7 helpline in the Ministry to provide adequate guidance and support to MSMEs amid the lockdown.

While highlighting the crisis, she said MSME sector is suffering around Rs 30,000 crore loss every day due to the lockdown and efforts should be made to help revive them as they are the backbone of the economy.

"If ignored, this issue has the potential of having a devastating and expansive ripple effect on our economy," she said in the letter.

The letter also diverted the attention towards factors that lead to lack of accessibility to available credit for MSMEs. These factors include “high collateral security” and “limits on margin money being extremely high.”

“The government should also explore a waiver/reduction of taxes for MSMEs and other sector specific measures,” the letter stated.

She also added that as the nation continues to fight against COVID-19, it is essential to highlight an economic concern that needs immediate attention and intervention.