CHENNAI: In a bid to ensure the state doesn’t face oxygen crisis during the pandemic, entrepreneurs in Tamil Nadu have urged the government to encourage small and medium enterprises to venture into medical-related industries.
VS Narasimhan, president of the Small Industries Management Association and former president of the Tamil Nadu Small and Tiny Industries Association, told Express that the State government has issued a special G.O. announcing support to those units willing to venture into manufacturing oxygen generator or concentrators, among other support, by allotting required land, special capital subsidy, and loan through Tamil Nadu Industrial Investment Corporation (TIIC).
For all the support offered to State units, they could be advised to offer oxygen generators to hospitals here, and the government should be requested to buy from such manufacturers on priority, he said.
“The State government should offer a price preference of 15 per cent to such manufacturers, which will encourage entrepreneurs to venture into medical-related industries here.”
“TIIC has offered loans with interest subvention of six per cent while currently, it is charging 12 per cent interest. However, the subvention will be offered after a year or so, reimbursing six per cent. But the Small Industries Development Bank of India (SIDBI), a national institution, is offering loans for a similar purpose under a special scheme at 4.5 or 5 per cent where loans will be sanctioned in a coupls days,” said Narasimhan.
He added, “Being a national institution, SIDBI has to meet demands within the allocated budget, and as such, units in our State have to compete nationally. Under such circumstances, the TIIC, a State-supported investing institution, may consider offering loans straight away at a lower interest rate, say five or six percent.”However, another issue before entrepreneurs is that TIIC offers loans against a collateral.
“Their anxiety to get loans repaid, more so during the pandemic or lockdown is understandable. ,Hence it will be good if the TIIC could get coverage under the Credit Guarantee Corporation Trust of India, if not done already, and offer collateral-free loans,” Narasimhan added.
Meanwhile, KV Kanakabaram, president of the Industrial Estate Manufacturers Association, told Express that TIIC has helped many State units when they were in distress.
“TIIC has waived interest on loans in cases where the principal amount was repaid,” he said. Kanakambaram has also sought such a scheme from commercial banks to help Micro, Small & Medium Enterprises (MSMEs) in distress during the pandemic. Additionally, an Emergency Credit Line Guarantee Scheme (ECLGS) is also sought for units that have availed the restructuring scheme earlier. As per the new norms, units which have taken loans during the first wave are not eligible, he said.