The medium and small scale enterprises (MSMEs) of Himachal Pradesh are facing a tough time amidst fresh hiking of bank rates announced by Reserve Bank of India (RBI). Arun Rawat, president, Baddi Barotiwala Nalagarh Industries Association (BBNIA) said every two per cent increase in interest rates results in a 10 per cent profit-eroding for the Medium and Small Scale Industries.
The RBI, on June 16, raised the repo and reverse repo rates by 25 basis points. This is the tenth rise in interest rates by RBI in the last fifteen months, to curb inflation.
BBNIA along with other industrial organisations like Confederation of Indian Industry (CII), Himachal Pradesh, has urged MSME minister Virbhadra Singh, to take measures which could streamline the credit flow for MSME sector. Himachal Pradesh has around 36,000 units in the medium and small scale sector.
Rajiv Malhotra, chairman, CII Himachal Pradesh said, “MSMEs are demanding a scheme which could provide interest subvention for the MSME sector, considered to be the engine of economic growth.”
“The MSMEs in the state are also yearning for effective MSME board which could help in solving MSME related issues effectively,” addedd Rawat.
Meanwhile, Virbhadra Singh announced plans for setting up of a mini tool room at Baddi. For setting the tool room, the union government would contribute 90 per cent towards its development and 10 per cent would be pooled in by the industry associations. The state government would provide free land and 10,000 square metres of land has already been identified for setting the proposed room. According to Rawat, the mini tool room would solve the long-pending demand of industry association in Himachal.
In addition to serving as common facility centre for the small and medium units in the region, the tool room would also offer training to youth, and help the industry in getting skilled labourers.