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Nirmala Sitharaman practices what she preaches, directs ministries to clear all Rs 20,000 cr dues to MSMEs

Akshay Narang by Akshay Narang
29 September 2019
in Trending
Nirmala Sitharaman, budget

(PC: PTI)

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Finance Minister Nirmala Sitharaman has persisted with her efforts to boost economic growth. As per reports, In yet another move to boost growth Sitharaman has asked all the ministries and government departments to clear all overdue payments to Micro, Small and Medium Sector Enterprises (MSMEs) and all those who have supplied them goods and services. After meeting top officials of 21 key infra ministries, Sitharaman said,

“No overdue payment should be with any ministry… My intention is to make sure that the government does not sit on the payments that are due. The government does not sit on capex than it has planned. I’m gearing up the machinery so that what is expected outside to happen should also be enabled from us.”

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Finance Minister Sitharaman also said that the ministries have cleared most of the dues of goods and services to suppliers, consisting mostly of MSMEs. The remaining payments will be made in the next few days. After meeting infrastructure ministries, Expenditure secretary G C Murmu said that out of the outstanding dues of Rs. 60,000 crore, Rs. 40,000 crore had been cleared. As per him, the remaining amount which is not stuck in litigation would also be cleared by the first week of October.

Earlier, Finance Minister Sitharaman said that she has instructed the Central Board of Direct Taxes (CBDT) to clear pending GST refunds of the MSMEs within 30 days. From then on, GST refunds would have to be made within a period of 60 days. This move would give ample breathing space to the MSMEs in operating their businesses.

Apart from this, the Finance Ministry has also given clear signals about the fact that it is closely monitoring the capital expenditure spending of all the ministries. Nirmala Sitharaman also asked all the ministries to provide their capital expenditure plans for the next four quarters. She said,  “Within next week, we will have a clear picture of what is the capex by ministries in next four quarters.” Expenditure Secretary G C Murmu said that most infrastructure companies have reached 50 per cent of the capex target for the ongoing fiscal.

This meeting assumes a lot of significance as the MSMEs have raised concerns that their payments were not being released in time by different wings of the government. MSME sector representatives had clearly told Sitharaman and Union Minister Gadkari that this was the biggest problem when it came to clearance of dues. This was pushing many of them towards bankruptcy due to a funds crunch on account of which they could not pay installment on loans. Now, the Finance Ministry has shown the ability of thinking out of the box. By The move of asking the government departments to clear outstanding dues in a time bound manner and also giving similar instructions to he CBDT about GST refunds, the government has moved towards solving the issue of funds crunch. This will help the MSME units to operate more smoothly, pay installments more comfortably and will also give them the breathing space for expanding their businesses.

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