A good number of MSMEs are in a tight spot today. And it is not merely because of the power situation in the State, but a host of other issues including cultural and attitudinal problems, observed S. Sivagnanam, Additional Industrial Advisor, MSME, Chennai.

He was in the city at the two-day National Vendor Development Programme organised jointly by the Coimbatore District Small Industries Association (Codissia) and the Ministry of Micro, Small and Medium Enterprises (MSME).

“On the one hand bankers are reluctant to extend finance support to the MSMEs fearing repayment issues, while on the other, these units are admittedly weak in developing quality products and technology adoption. There has to be a standardised approach for a product and we need to do a benchmark study,” he said.

On the subject of cultural and attitudinal issues, he said, “this is another big issue which cannot be resolved through such programmes,” referring to the vendor development programmes.

“India is a leader in software services, but there is lack of adoption of IT tools amongst the MSMEs,” he reiterated and urged participants to enhance their competitiveness.

Sivagnanam also stressed the need for sorting out issues relating to credit link.

The MSME Additional Industrial Advisor pointed out that with bankers insisting on collateral security for support under the Credit Guarantee Fund Trust Scheme, less than 5 per cent of the MSMEs obtained institutional finance. To a query on the amount that would be required for floating such a corpus fund, he said, “We have no clear statistics on the number of MSMEs as registration of such units is not mandatory. However, for availing Government subsidy/incentive, they have to register. Our records show that there are over 27 million MSMEs. There should be twice that number of unregistered units.”

Ashokan, General Manager, District Industries Centre, said that the State Government was giving lots of incentives and subsidies to promote new industries and graduate the existing ones. He urged industry stakeholders to take advantage of the schemes.