CII Seeks Emergency Credit, Moratorium & Liquidity Support For Msmes

(MENAFN- KNN India) New Delhi, Apr 6 (KNN) The Confederation of Indian Industry (CII) has proposed a set of measures including a temporary moratorium on loans and restructuring window for MSMEs to provide relief to various sectors affected by the ongoing West Asia conflict even as it hailed the steps taken by the government and Reserve Bank of India (RBI) to cushion the industry from economic fallout arising from the war.

Call for Targeted Liquidity and Credit Support

The industry body has proposed a comprehensive set of measures, including a time-bound emergency credit guarantee scheme (ECGS) for affected sectors, similar to pandemic-era support, to ease working capital constraints.

It also recommended that the RBI consider a temporary moratorium and restructuring window for MSMEs, alongside a special refinance facility and targeted liquidity injections to ensure continued credit flow.

Relief on Costs and Compliance

CII has suggested easing contractual obligations for businesses by extending delivery timelines for government contracts and reducing bank guarantee requirements. Temporary relief in electricity tariffs and a reduction in banking-related charges were also proposed to help firms manage rising input costs.

Additionally, it called for faster settlement of GST refunds and export incentives, along with expanded use of invoice discounting platforms to improve liquidity.

Focus on Trade and Investment Stability

To support exporters, CII recommended rationalising duties on energy inputs and strengthening export credit and insurance frameworks through agencies such as the Export Credit Guarantee Corporation and EXIM Bank.

The chamber also proposed measures to sustain foreign investment, including temporary tax incentives and policies to encourage capital expenditure.

Medium-Term Structural Reforms Suggested

Over the medium term, CII advocated the creation of institutional frameworks such as a crisis response mechanism for MSMEs and an economic shock response system with predefined policy triggers.

It also emphasised the need to diversify trade routes, strengthen logistics resilience, and enhance coordination among ministries and regulators to respond effectively to future disruptions.

Need for Continued Coordination

CII underscored that close coordination between the government, regulators and industry will be critical to navigating the evolving global environment. It added that proactive and adaptive policymaking will be essential to sustain growth and minimise the long-term impact of external shocks on the economy.

"The Government and the RBI have responded with speed, clarity and coordination. The early measures have helped stabilise sentiment and demonstrate that India's policy framework is both responsive and resilient in the face of external shocks," ANI quoted CII Director General Chandrajit Banerjee as saying.

Despite initial relief, the industry body noted that supply-side pressures in energy, logistics and trade continue to affect businesses. Micro, small and medium enterprises (MSMEs), exporters and energy-intensive industries remain particularly vulnerable, facing operational disruptions and financial strain.

CII highlighted that while early measures have mitigated immediate shocks, a second phase of targeted interventions may be required to address emerging challenges.

(KNN Bureau)

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