Reserve Bank may take steps to revive export-oriented SMEs

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Mumbai: The Reserve Bank of India (RBI) is likely to take steps to revive export-oriented small and medium enterprises (SMEs) which face a host of problems owing to contraction in demand.

However, the central bank doesn’t seem to be in favour of going beyond the existing regulatory norms.

Some of the SME sectors’ demands like revision in margin norms, availability of additional funds and restructuring of loans may be accepted by the regulator.

However, some other demands like increasing the NPA norms duration from the existing 90 days to 180 days and the provision for interest rate subvention of loans on the lines of the ones given to the agricultural sector may not be possible.

According to bankers who were present at an interaction with RBI governor D Subbarao, the RBI may consider some demands of the SMEs but some may not be acceptable.

In other words, too much diluting of the regulatory norms may not be possible, said the bankers.

Three deputy governors of the central bank, out of four, were present on the occasion. The export-oriented SMEs including leather, garments, textiles, heavy machinery have already apprised their problems and expectations from the banks during their meeting in Mumbai a couple of days ago .