Milestone of India - Banks asked to give financial support to MSMEs.

SERVING THE NEEDY: President Pratibha Patil with Minister for Micro, Small and Medium Enterprises Dinsha J. Patel (left) and Secretary Dinesh Rai (second from right) presenting the national award for excellence in lending to micro enterprises for 2009-10 to Chairman of State Bank of India O. P. Bhatt in New Delhi on Tuesday.

NEW DELHI: Lauding the crucial role played by medium and small industries in the growth and development of the country, President Pratibha Devisingh Patil on Tuesday asked banks to provide financial support to micro and small enterprises to facilitate fast growth of the sector that gives employment to crores of people in rural and semi-urban areas.

“Availability of adequate credit is paramount to the success of the micro and small enterprises. It must be kept in mind that it is the vulnerable unorganised enterprises which are still perceived as risky by financial institutions, and suffer the greatest constraint in access to credit, because of the very nature of operations, especially of the traditional cottage industries. Timely financial support is absolutely essential for their survival, failing which they face the threat of extinction,” Ms. Patil said after presenting the national awards for micro, small and medium enterprises (MSMEs). A total of 171 awards were presented in various categories.

Pointing out that the contribution of MSMEs to the economic growth is recognised worldwide, the President said: “In India, these enterprises account for almost 45 per cent of manufacturing output, 95 per cent of the number of industrial units and 40 per cent of exports. Clearly, they are engines of growth providing employment to almost 6-crore people, making it the largest source of employment after the agriculture sector.”

Ms. Patil called upon the MSMEs, especially of the traditional sector, to employ cost effective technologies, particularly in sectors like the coir industry which employs about 5.5 lakh persons, many of whom are women in the coconut growing states of the country. “It is undeniable that technology and innovations are game changers, being the key determinants of increasing productivity through improvement in skills, better capital equipment and better systems,” she added.

Speaking on the occasion, Union Minister of State for Micro, Small and Medium Enterprises, Dinsha Patel, said they were implementing recommendations of the MSME task force set up by the Prime Minister that provides road map for the development and promotion of these units.

“We have already around 40 of the total 87 recommendations, while the rest will be done by the end of this year, further boosting the growth of the sector,” Mr. Patel added.