The Hindu Business Line : `Retrieval of investment vital in closure of sick SMEs'

Hyderabad May 10 Retrieval of investment should be given importance in the closure of business by sick micro, small and medium enterprises, Mr M. Gopala Krishna, former Chairman of Andhra Pradesh State Financial Corporation, has said.

Speaking at a meet on the `Exit Policy Under the Micro, Small and Medium Enterprises Development Act, 2006' organised by the Federation of Andhra Pradesh Chambers of Commerce and Industry (FAPCCI) here on Thursday, Mr Gopala Krishna said the possibility of making the sick unit turnaround should also be examined.

"It is also vital to probe into the setting in which about 60 per cent of small and medium enterprises were turning sick soon after launching operations," he said.

Norms

Mr B. Yerram Raju, Director, Indian Institute of Economics, said problems in accessing credit before and after turning sick should be addressed on a priority basis.

"The State Government should involve all partners and institutionalise the monitoring mechanisms for implementing industrial rehabilitation and revitalisation norms," he said.

Revival schemes

Mr A.P.K. Reddy, President, Andhra Pradesh Incipient Sick SSI Federation, said the financial institutions were resorting to "ruthless application" of fund diversification and non-performing asset norms on small-scale industries.

"The district promotion committees should chalk out schemes for revival of a sick unit in the first 30 days of loan payment default instead of waiting for 90 days to label the unit as NPA," Mr Reddy said.

Mr A.R.K. Rao, Small Industries Service Institute (SISI) Director, stressed the need to strengthen the marketing network of SSIs to be profitable.

The office-bearers of FAPCCI and industry representatives were also present.

More Stories on : SSI | Sick Units | Andhra Pradesh

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