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Sonia Gandhi writes to PM Modi, suggests implementation of five-point programme to rescue MSME sector

Speed News Desk | Updated on: 25 April 2020, 19:18 IST

Congress leader Sonia Gandhi on Saturday put forward that the centre should implement a five point programme to bail out micro, small and medium scale enterprises from collapse.

In a letter to Prime Minister Narendra Modi, the Congress leader stated that the government should announce “a Rs 1 lakh crore MSME Wage protection package. This would go a long way in shoring up these jobs, boosting morale as well as greatly alleviating the predicted economic spiral.”

Sonia Gandhi also advocated the the centre “establish and deploy a credit guarantee fund of Rs 1 lakh crore to provide immediate liquidity to the sector and ensure adequate capital is available to MSMEs at a time when they need it most.”

She also stated that “actions taken by RBI must get reflected in actions by commercial banks to ensure adequate, easy and timely credit to MSMEs.” Any monetary action at the RBI’ send must be backed by sound fiscal support from the government, she added.

The Congress leader also suggested lengthening the RBI’s moratorium on loan payments by MSMEs.

“These measures need to be supported by an expansion and extension of the RBI’s moratorium on payment of loans for MSME beyond the stipulated period of three months. The government should also explore a waiver/reduction of taxes for MSMEs and other sector specific measures.”

Sonia Gandhi further suggested that the government address the issue of high collateral security leading to repudiation of credit.

The Congress leader claimed that the MSME sector was bearing a hit of Rs 30,000 crore per day during the lockdown and 11 crore employees faced the risk of losing their jobs.

“Government has acknowledged MSMEs to be the backbone of our economy. It is time it takes measures to ensure the revival and strengthening of that backbone. This is a case where timely and decisive action can make all the difference,” She wrote.

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First published: 25 April 2020, 19:18 IST