MSME Ministry to assess requirements of sick fabrication units in Tiruchi

Improved industrial scenario has reflected in good order book position of BHEL
The Prime Minister's Office has reportedly issued instructions to the Ministry of Micro, Small and Medium Enterprises to study the requirements of Tiruchi Engineering Cluster to arrive at a rehabilitation package for sick units.

A team of the MSME is expected to visit Tiruchi shortly for a survey of the difficulties the SME units in Tiruchi are facing due to repayment problems caused by economic recession over the last few years.

The improved industrial scenario has reflected in good order book position of BHEL. Orders for BHEL declined in previous years due to the imbroglio in allotment of coal mines. In view of non-availability of coal for thermal power production, the utilities had preferred to wait for better supply.

At the start of this year, enabling provisions were made by the Centre in the Coal Mines (Special Provisions) Act, 2015 for allocation of coal mines by way of auction and allotment for the sale of coal.

BHEL's ancillaries that were struggling with repayment problems are now eager to wrest the opportunity with their expertise.

The Tamil Nadu Boilers Association (TNBA) has sounded of a requirement of Rs. 600 crore in the first phase for reviving the industries and generating employment. In the subsequent phase, the requirement will be in the extent of Rs. 900 crore, said Treasurer of TNBA, Rajappa Rajkumar.

The district administration and the District Industries Centre have already taken cognisance of the sickness of the industries for remedial action.

The rehabilitation package of Rs. 1,500 crore at a lesser interest rate will be sufficient for the sick industries to make one-time settlement to the banks and revive operations.

“We have sought the settlement package with lesser interest rate similar to the extent levied for packing credit,” Mr. Rajkumar said.

The ancillary units are now struggling to repay the loans that were forwarded with interest rates ranging from 10 to 14%.

The interest rate of 3.75% for the settlement package will be much helpful for the ancillaries to revive and flourish, he said

Source - The Hindu