'Unavailability of credit marring growth of sector'

Q&A/ Vishram Jamdar, national president, Laghu Udyog Bharti

Started in 1996 with a mandate to establish a national association of micro and small enterprises, Laghu Udyog Bharti (LUB) now has over 10,000 members across the country.

Vishram Jamdar, national President, LUB, talks to Rayana Pandey about the challenges that lie ahead for the micro, small and medium enterprise (MSME) sector.

How has the rupee rise impacted exporters from the MSME sector?

The previous orders are being executed now and resulting in heavy losses because of the appreciating rupee. But again, the rupee rise indicates that our economy is getting stronger. Also, we cannot afford to ignore the benefits being enjoyed by entrepreneurs, who can now import raw materials at a lower cost.

What are the major problems that the MSME sector faces today?

The unavailability of bank credit is marring the growth of the MSME sector. Even after the Reserve Bank of India's directive to all nationalised banks, small units don't get bank loans without the collateral security. Besides, inadequate power supply is also a cause of concern.

Has the LUB achieved what it set out to, in terms of consolidating the SME lobby?

We have made a headway in this regard but a lot more remains to be done. The organisation has not only impacted the MSME sector but also made its presence felt in all the relevant ministries of the central government.

We now have representation in the MSME National Board, various committees of the government labour department, finance departments and others. Not only this, we have a representative in the core committee of the 11th Five-Year Plan. All such engagements have helped in strengthening our organisation.

What do you expect from the government?

The MSME sector is so huge and vital for our economy that there will always be something to be done. We do hope that the government simplifies various laws affecting the MSME sector directly. This will take care of most of the problems of this sector.

What major steps are you planning to take in the near future?

The consolidation of the organisation and further expanding it to the district level are what we are working on. Our think-tank has various plans for the future. We train our representatives in management principles and teach how to serve the small and the micro enterprise sector better. We are also in the process of establishing our centres in states like Jammu & Kashmir and Assam.