Chennai: In the first half, central PSUs have spent only 32 per cent of its capex target for the fiscal. Central PSUs have cleared pending payments of over Rs 13,400 crore to micro, small and medium enterprises in the last five months.
The central PSUs have a capital expenditure target of Rs 1,15,934 crore for the fiscal 2020-21. Till the first half of the year, they have only achieved 32 per cent or Rs 37,423 crore of this target. This is 13 per cent lower than the capital expenditure made in the first half of last fiscal. In H1 FY20, CPSEs had spent Rs 43,097 crore even when the total target was Rs 1,11,672 crore. However, by the end of the year, they had achieved 104 per cent of the capex target.
The Finance Ministry wants the CPSEs to achieve capital expenditure to the tune of 75 per cent of the capital outlay by the end of Q3 of FY 2020-21. While reviewing their performance, the ministry stressed on more coordinated efforts at the levels of secretary of concerned ministries and CMDs of CPSEs to achieve CAPEX targets.
The government finds that better performance of CPSEs can help the economy in a big way to recover from the impact of Covid-19.
Meanwhile, the government has claimed that CPSUs have cleared Rs 13,400 crore of pending payments to MSMEs in the past five months. Out of this, payments worth Rs 3700 crore have been made in September only.
Though it is mandatory for all CPSEs and companies with turnover of more than Rs 500 crore to join the TReDS platform started by RBI, many companies are yet to join it or transact on it. MSME Ministry has now written to the top management of over 2800 corporates by name to make payment of pending dues of MSMEs in this month itself. Last month, the ministry had written to top 500 corporates about the pending payments of MSMEs.
According to reports, MSMEs have around Rs 5 lakh crore of pending dues from PSUs, government agencies and private enterprises.
The MSME Development Act, 2006 mandates companies to make the payment to MSMEs within 45 days. If the cash flows of MSMEs improve, they can make use of the festival season when there is opportunity to earn by supplying goods and services. Some of the MSMEs look for such a period for their sustenance of the whole year.