Gaining access to pass-outs, or graduates, of the country’s premier business schools such as the Indian Institutes of Management (IIMs) just got a little more affordable. IIMs has waived the recruitment fee to enable participation from more companies in the hiring process. That means top-tier graduates can now be hired at much lower packages than they used to get when the global economy was booming — good news for small and medium companies.

The Confederation of Indian Industry (CII) recommended that the Reserve Bank of India (RBI) take additional measures to step up bank credit to help the MSME sector. The point was made on the basis that credit to MSMEs has been particularly weak, reducing the ability to handle issues like elongated payment cycles. The need was for RBI to step up bank credit and consider setting up a sub-target under priority sector lending.

The suggestion was presented at the CII meeting with banks and economic secretaries.

The challenges facing micro, small and medium enterprises (MSMEs) are being taken up in the party manifesto of the CPI party as a special package planned for protection and development of small scale industries, cottage industries and craft of artisans.

The party is also seeking the deferred recovery of small business loans until the economic slowdown improves.

On behalf of several small business associations and industry players, the Finance Ministry has asked the RBIs to increase the mandatory lending limit to micro, small and medium enterprises in India from 12 percent to 15 percent.

Earlier the RBI had asked public sector banks to increase credit flow to the small business sector.

A US study has named the “Buy American” provision in the $800 billion economic stimulus bill as “bad for jobs, worse for reputation.” Making a formal request to the US Congress to remove the provision, the study warned that “the negative job impact of foreign retaliation against Buy American provisions could easily outweigh the positive effect of the measures on jobs in the US iron and steel sector and other industries.” Additionally, the study indicated that the provision may encourage key suppliers like China, India, and Brazil to retaliate.

The Reserve Bank of India has left key rates unchanged; the repo, the reverse repo, bank rate and the cash reserve ratio (CRR) are held at current levels. The central bank expects the economy to worsen further and has revised the GDP growth target to 7 percent from a previous estimate of between 7.5 to 8 percent. Additionally, inflation targets for the fiscal year were reduced to 3 percent from earlier projections of 7 percent.

Indian public sector banks will lend over Rs 13,000 in small business loans from January to March at rates under 10 percent. The government announced the new initiative as part of the country’s second ‘stimulus package.’

Additionally, the Reserve Bank of India will extend a Rs 7,000 crore line of credit to SIDBI (Small Industries Development Bank of India) before March 31 to provide loans to Indian small businesses. Out of the Rs 7,000 crore, about Rs 6,500 crore will be lent to public sector banks at a rate of 6.5 per cent. The rest of the funds will go to State Finance Corporations.

The Marathwada Association of Small Scale Industries and Agriculture (MASSIA) has approached banks to consider a moratorium on repayment and debt restructuring, higher working capital limits, additional term loans and bills discounting or factoring.

The Association has engaged the government for assistance in reviewing non-performing MSMEs assets to overcome temporary lows and help keep the units alive.

Tamil Nadu has announced additional incentives on industrial investments made in distressed regions in southern districts. Previous incentive packages have attracted 29 new industries to the state, generating around Rs 37,595 crore in investments and employing over two lakh people. Tamil Nadu will also launch the Chief Minister’s Insurance Scheme this year.

An MSME Credit Monitoring Cell has been formed in the Office of Development Commissioner, Ministry of Micro, Small and Medium Enterprises to monitor the loans made to Indian small business. The Credit Monitoring Cell will manage cases that have not been resolved by banks within 14 days.