Reeling under liquidity pressure and plagued by demand slowdown in exports due to global economic meltdown, Micro and small medium enterprises (MSME) in Punjab, is fighting hard for its survival. SME exporters of the state are the worst hit as they are facing the delay in payments from their foreign buyers and are hardly receiving new orders their products.

Putting forth the troubles being faced by MSME sector, at special meeting of state level bankers? committee, (SLBC) Punjab on MSME sector held in Amritsar on Monday, president of Federation of Tiny and Small Industries of India, Joginder Kumar, said ?MSME with an investment of Rs 1 crore have adversely been affected as the importers have cancelled their orders. Manufacturing units particularly light engineering industry is in bad shape. The finance minister had announced on August 10, 2005, to double the credit to SME sector within five years from Rs 68,000 crore to Rs 1,36,000 crore on 20% year on year growth, whereas, the credit to SME sector was Rs 1,48,000 crore on March, 31, 2008. As per the report of Dr K C Chakrabarty, CMD of PNB on SME sector there has been decline in credit to enterprises with investment in plant and machinery up to Rs 5 lakh?.

Demanding the support from commercial banks, Joginder also said that service charges being taken by banks are quite exorbitant which should be brought down. The federation also maintained that commercial banks don?t encourage the rehabilitation of sick viable units. Besides he urged that banks should lower the lending rates. When contacted Opinder Singh, deputy director, Engineering export Council, Jalandhar said that currently companies are facing downfall by 15% -20% in their business volumes. To redress the problems faced by MSME, SLBC was convened by PNB. While speaking about the initiatives taken by RBI in order to boost the MSME sector, Chakrabarty informed that now each public sector bank (PSB) will also set up Regional MSME care centres to facilitate entrepreneurs for quick redressal of their grievances. The function of these centres will be monitored directly by head office and the list of such centres will be posted on IBA portal and on website of each PSB. PSBs will grant need based adhoc working capital demand loans up to 20% of the existing fund based limits in respect of units having overall fund based credit facility up to Rs 20 crore.