FM Nirmala Sitharaman for timely payments to MSMEs

India Inc needs to ensure that payments of micro, small and medium enterprises (MSMEs) are not delayed, finance minister Nirmala Sitharaman said Thursday. She also said the Centre is in touch with state governments to ensure faster utilisation of funds earmarked to disburse soft loans for infrastructure creation.

In her first post-budget interaction with industry, organised by the Federation of Indian Chambers of Commerce & Industry (FICCI) members, Sitharaman said, “Pay them (MSMEs) for goods and services they have delivered within 45 days... It has to be implemented by all of us, government departments, public sector banks, enterprises and businesses.”


She said large Indian industries need to extend this ‘rightful deserving gesture’ at a point in time where there are recovery pangs.

“India has to recover. Payment dues cannot be sitting locked up by those who are working with you,” Sitharaman said.

MONEY TO STATES FOR CAPEX
Responding to a query from Naina Lal Kidwai, chairperson, Rothschild & Co. India, about the slow pace of utilisation of the 50-year interest-free loan given to statesfor capital expenditure, Sitharaman said it was not as ‘disheartening as inferred’ from the Economic Survey 2022. State governments are offered money for infrastructure projects through a 50-year capital expenditure soft loan.

According to Sitharaman, fund utilisation was delayed because states had to come up with proposals and then set it rolling. She said around 80% of the current financial year’s `1 lakh crore was unconditional so the states could use it the way they want. The remaining 20% had conditions attached such as power and ration card reforms.

“It has been extended because we felt there was a good appetite for more funds and continuation of this scheme. We have also increased the outlay for FY24 to `1.30 lakh crore,” Sitharaman said, adding that the Centre is in talks with states to speed up disbursal and expenditure.