Back to life: Telangana sees revival of these many sick MSMEs so far

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Published: September 16, 2019 7:53:29 PM

In 2017, the Telangana government had launched an NBFC -- Telangana Industrial Health Clinic Limited (TIHCL) to prevent incipient sickness among MSMEs and to rehabilitate sick units.

33 sick units were reportedly revived till around mid last year.

Around 70 sick micro, small and medium enterprise (MSME) units in the textile and powerloom sectors in Telangana have been supported and many of them have been revived, Telangana’s Principal Secretary for Industries & Commerce and IT Jayesh Ranjan told Financial Express Online. The secretary said that interventions made in terms of rehabilitating these MSMEs have been quite encouraging even as it is a work in progress. In 2017, the Telangana government had launched an NBFC — Telangana Industrial Health Clinic Limited (TIHCL) to prevent incipient sickness among MSMEs and to rehabilitate sick units.

The NBFC had earlier this launched a web portal I-Health in partnership with Microsoft for sick MSEs to register themselves for support from TIHCL and encourage banks to partner with them to revive the sick units. While the number of sick units in Telangana around early last year was reportedly around 60 per cent however Ranjan said “the statistic of sick MSMEs here (in the state) is around 10 per cent. The industrial health clinic is one of its kind institution in India that no other state in India has. This has been done with the understanding that sickness doesn’t happen overnight. Signs of sickness starts getting noticed which is called as incipient sickness,” said Ranjan. 33 sick units were reportedly revived till around mid last year.

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While banks which have lent working capital to small businesses have some responsibility to study incipient sickness of MSMEs and try to turn them around but they can only help units from the capital part of it by rescheduling loans, giving additional working capital etc., said Ranjan adding that there are sometimes issues like macroeconomic, product-market becoming unviable, policy issues, etc., that have to be dealt with.

Ranjan said that over a period of time, Hyderabad has developed more than 70,000 including improvement in business processes, technology sophistication and becoming part of the global supply chain for instance MSMEs in the plastics, packaging sector, machine tools sector etc. The number of sick MSME units in Telangana according to the government data as on March 31, 2016, stood at 7,847 units, former MoS Commerce Ministry CR Chaudhary in April 2018 had said in the Lok Sabha pertaining to the number of closed or sick industry in India.

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