Eyeing at ensuring government support, Arvind Subramanian, Chief Economic Advisor, Government of India stressed that the government is exploring all possible options to increase the flow of credit for the sector.
He further said that the economy can achieve a dynamic status only when small-scale units are encouraged and in due course, they grow adding to the overall growth of the economy.
Subramanian made these remarks during an interaction with representatives from industries in Chennai.
Commenting on the significance of the sector in the exports, he said that even the exports of the country is able to perform well with a well sound MSME ecosystem.
Responding to a question on the dearth of credit flow to MSMEs,Subramanian said macro economic conditions necessitate caution against easing monetary policy.
“In the last 12 – 18 months cost of capital has come down. Also, the government is looking at measures to increase flow of finance to MSMEs and others”, he responded.
He further mentioned about the new taxation and its role in ensuring transparency.
“GST and the transparency in transactions will support MSMEs to demonstrate their track record and enable access to funds in the near future”, he stressed.