When asked, the minister of state for finance Jayant Sinha described his own Reserve Bank of India-sourced ministry's data wrong.
The agenda paper for the finance minister's meeting with public sector banks on Monday revealed 'Credit to manufacturing MSEs (micro & small enterprises) has shown a negative growth', which is contrary to government claims.
When asked, the minister of state for finance Jayant Sinha described his own Reserve Bank of India-sourced ministry's data wrong.
"We have discussed a lot on that figure in the review meeting. Some bankers have an opinion that these figures need to be changed because some loans were going into agriculture and agro process are excluded. But if these has been included there will be growth. We will (be) studying the figures again," he said.
It means RBI data are wrong because agenda paper gave the source as central bank.
According to the finance ministry agenda note, from March 20, 2015 to March 18, 2016, manufacturing MSE recorded a negative growth of 2.3%. In its analysis segment, the note mentioned that MSE credit has declined from 13.1% of gross bank credit to 5.9%.
Though the government used March 18, 2016 data, the RBI has published new data till April 29 2016. Latest RBI data on credit lending shows gloomy numbers for the MSEs with the sectoral deployment of bank credit to the micro, small and medium enterprises (MSME) sector consistently declining.
As per the latest data, during the period April 18, 2014 to April 17, 2015, the deployment was 5.9%, which plunged to -2.5% during March 18, 2016 to April 29, 2016 period.
MSMEs contribute 45% of total industrial output and 40% of the country's total exports along with providing employment to six crore people. The sector creates 13 lakh jobs every year. As per International Finance Corporation, the total financing demand gap in the SME sector is Rs 2.93 lakh crore.
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