Niramala Sitharaman also clarified that dues to MSMEs include payments from the state governments and state-owned PSUs and those in regards to GST.
Finance Minister Nirmala Sitharaman has said that the Centre will clear all dues to medium, small and micro enterprises (MSMEs) within 45 days. “I am personally monitoring this,” she added.
Sitharaman made the statement during question hour in Parliament on July 26 while clarifying the government’s position on clearing dues owed to MSMEs by the Centre and its public sector undertakings (PSUs).
The finance minister’s official account tweeted: “The Central Government has taken this position that any pending payment to MSMEs will have to be given in 45 days and I am personally monitoring it” (sic)
The Central Government has taken this position that any pending payment to MSMEs will have to be given in 45 days and I am personally monitoring it: Smt @nsitharaman answers a question on Govt dues to MSMEs during the Question Hour in the Lok Sabha today@FinMinIndia pic.twitter.com/MzO1IlMEeq
— NSitharamanOffice (@nsitharamanoffc) July 26, 2021
In her reply to the Lok Sabha, Sitharaman called government dues to MSMEs a “very critical issue” and said that the matter was also discussed with MSME Minister Nithin Gadkari who “spoke to me about it with great concern.”
She added that the issue has been “reviewed over the past year (2020) from the point of view of the central government and the various departments which owe money to the MSMEs, inclusive of public sector undertakings (PSUs)” and it has been decided that payments will be made within 45 days – as per the standard.
She also said that the Centre is “actively encouraging” MSMEs to use the Trade Receivables Discounting System (TReDS) platform from which “these payments can be discounted”.
The TReDS platform enables discounting of invoices/bills of exchange of MSME sellers against large corporates, including Government departments and public sector undertakings, through an auction mechanism to ensure prompt receivables at competitive market rates.
Sitharaman also clarified that dues to MSMEs include payments from the state governments and state-owned PSUs and those in regards to the goods and services tax (GST).
On GST dues, the finance minister said, “It is the GST Council which will have to take a response and call on how they would want the states also to get into the scheme of things. As regards GST payment, the GST Council is the final authority and it is they who have to take a call.”
“So as far as the central government, we have taken this position that any pending payment will have to be given within 45 days and I am personally monitoring it,” she added.
