MSME unit holders stare at bankruptcy as Govt dithers on clearing Rs 200 crore arrears

Srinagar: Jammu and Kashmir government has failed to clear Rs 200 crore arrears of the Micro Small  and Medium Enterprises (MSME) unitholders in the valley.

This is despite clear-cut directions from the union government to liquidate pending bills of unitholders given colossal losses incurred during the lockdown.

The MSME unit holders said that non- payment of bills by the government has brought them on the brink of bankruptcy. 

Federation Chamber of Industries Kashmir (FCIK), an apex body of industrial unit holders in Kashmir, claims the government is a major defaulter of the MSME sector as the payment of supplies worth Rs 200 crore has been withheld.

  “In one instance, the government didn’t pay Rs 33 crore on account of supplies made under the SAUBHAGYA scheme. An MOU was signed between Principal Secretary Industries and Commerce, Commissioner Secretary PDD, MD JKSICOP and representatives from MSMEs (FCIK) on September 11, 2018, for the supply of Steel Tubular Poles etc,” President, FCIK, Muhammad Ashraf Mir said.

 Subsequently, several orders were placed by SICOP after deliberations and a special discount. “These supplies amount to Rs 250 crore approximately. The payment was assured within 10 days on a consignment basis. The government has failed to fulfill its commitments,” he said.

 FCIK questioned the government’s move to attract investors at a time when local unitholders are pushed to margins.

 “The government on one hand is mulling ways to attract investments for industrial development but on the other, it seems ignorant about the plight of the local industrialists,” said a spokesman of FCIK.

 Under pressure, Commissioner-Secretary, Industries and Commerce Department, MK Dwivedi has asked the government departments to clear the pending bills.

 Sources said Dwivedi recently held a meeting with the senior officers Finance and Planning Department, Managing Director, SICOP and Director Finance, Industries and Commerce, and pressed for releasing the payment of the unit holders.

Official sources said Dwivedi was unhappy over the slow pace of clearing payments. “He directed the officers to come up with a final date for clearing the payments,” they said.