MSME will network with major equity players to encourage capital infusion
According to a media report, Ministry of Micro, Small and Medium Enterprise (MSME) will network with major private equity players to encourage capital infusion in small and medium enterprises (SMEs).
And for the purpose, MSME Secretary Uday Kumar Varma is gearing up to hold informal meetings with private equity players. Private equity firms are averse to investing in the sector due to the risk involved.
"I am proposing to hold a very informal meeting with them (private equity players) and find a way in this regard," Varma said, adding, "There is a lack of understanding of this sector, so we have to fill the knowledge gaps."
The units face problems in raising capital as they have to fulfill many conditions to get timely credit from banks and financial institutions.
Last month, Department of Industrial Policy and Promotion (DIPP) Secretary R P Singh said the government plans to provide incentives to venture capitalists who invest in small and medium-size enterprises.
The current level of venture capital funding in Indian SMEs is negligible, the report further said.