Things normalising for MSMEs after note ban, says Kalraj Mishra

New Delhi: Trying to dispel fears that the MSME sector had taken a big hit from demonetisation, Union Minister Kalraj Mishra today said things are falling in place slowly despite "initial difficulties".

Addressing reporters here on the ministry's achievements in 2016, Mishra admitted that "there were difficulties initially", but things are moving towards normalisation.

"There were difficulties initially, but wage payment to labourers has started normalising and migrant labourers who had left are returning," Mishra said when asked about reports of job losses in the informal sector after the cash recall exercise. About banks' reluctance to disburse loans under the MUDRA Yojana in the wake of demonetisation, Mishra acknowledged some issues, saying these are "only for the time being".

Banks are expected to disburse Rs 1.80 lakh crore loans under the Pradhan Mantri Mudra Yojana (PMMY) in the current fiscal. Last year, 3.5 crore beneficiaries availed of Rs 1.22 lakh crore loans under PMMY. Under the scheme, loans ranging from Rs 50,000 to Rs 10 lakh are provided to small entrepreneurs.

To increase sales of khadi products, the government is also trying to penetrate global markets and adopt a franchisee model to open more outlets in India, with an emphasis on attracting youth towards the indigenous fabric, the minister said.

Sales of khadi goods went up by about 29 per cent to Rs 1,510 crore in 2015-16. Mishra said the much-awaited Goods and Services Tax (GST) will benefit micro, small and medium enterprises (MSMEs) across the country.