The Ministry of Micro, Small and Medium Enterprises does not provide any direct financial assistance for rehabilitation of sick micro and small enterprises(MSEs).
However, financial assistance, by way of debt restructuring, including fresh loans, for the rehabilitation of sick MSE is provided by the primary lending institutions (PLI), including commercial banks, which provide credit to the MSEs.
For this purpose, the Reserve Bank of India (RBI) has already issued detailed guidelines to banks on detection of sickness in MSE at an early stage and taking remedial measures and for rehabilitation of sick MSEs identified as potentially viable.
Further, RBI has also issued guidelines based on the “Policy Package for Stepping up Credit to Small and Medium Enterprises (SMEs)” announced by the Central Government on 10th August 2005.
These guidelines relate, inter alia, to viability criteria, prudential norms for restructured accounts, provision of additional finance and time frame for working out the restructuring package and its implementation.
As per the data compiled by the RBI from the scheduled commercial banks, 588 viable sick MSEs were put under nursing at the end of March 2007.
This information was given by the Minister of Micro, Small & Medium Enterprises, Shri Mahabir Prasad in a written reply to a question in Lok Sabha.
Press Information Bureau Government of India
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