This Article is From May 15, 2020

"Minister vs Minister" In P Chidambaram's Swipe At Centre Over MSMEs

Finance Minister Nirmala Sitharaman announced Rs 3 lakh crore in collateral-free loans to MSMEs; MSMEs Minister Nitin Gadkari said they were due Rs 5 lakh crore

'Minister vs Minister' In P Chidambaram's Swipe At Centre Over MSMEs

Congress leader and former Finance Minister P Chidambaram tweeted on condition of MSMEs (File)

New Delhi:

Congress leader P Chidambaram took a swipe at the government today, highlighting apparently contradictory statements by two Union Ministers on condition of MSMEs (micro, small and medium enterprises) that have been adversely affected by the national lockdown over the COVID-19 virus.

In the first of two tweets posted at around 10 am, Mr Chidambaram referred to a comment by MSME Minister Nitin Gadkari, who told news channel CNBC-TV18 that government agencies owed MSMEs Rs 5 lakh crore in unpaid dues.

Mr Chidambaram then pointed to a statement by Finance Minister Nirmala Sitharaman on Wednesday, in which she announced Rs 3 lakh crores in collateral-free loans for 45 lakh MSMEs.

"Minister Gadkari says that governments and PSUs owe Rs 5 lakh crore as unpaid dues to MSMEs. Minister Sitharaman says she will offer collateral free loan of Rs 3 lakh crore to MSMEs (numbering 45 lakhs). So, who is the lender and who is the borrower?!" Mr Chidambaram tweeted.

"Will the two ministers 'settle their accounts' first and let MSMEs save themselves without government's 'help'?" the former Finance Minister said sarcastically.

Earlier this week, Ms Sitharaman, detailing the government's Rs 20 lakh crore COVID-19 economic relief plan, said loans to MSMEs would be credit-free and come with a 12-month moratorium.

The loans come as lakhs of small businesses across the country teeter on the edge of bankruptcy due to the coronavirus lockdown.

Last week Mr Gadkari said dues owed to MSMEs by central and state governments, as well as PSUs (public sector units) and other industries was "very high" and MSMEs, as a result of such outstanding dues, were engaged in a "battle for survival".

Mr Chidambaram's tweets today appear to indicate the contradiction in the two minister's statements, questioning the apparent non-payment of dues to MSMEs while adding to their loans outstanding.

The Congress leader had earlier expressed cautious approval of the government's relief plan for MSMEs, calling it "modest". He also expressed disapproval over other measures announced, describing the government as a "prisoner of its own ignorance".

Over the past two days Nirmala Sitharaman has made several announcements detailing disbursements from the Rs 20 lakh crore relief package announced by Prime Minister Narendra Modi.