Absence of a policy and a separate Ministry for Internal Trade is an ample testimony of the apathy towards the trading community. This has been stated by the Confederation of All India Traders (CAIT), in a communication sent to Union Finance Minister Nirmala Sitharaman on Thursday. The communication assumes much significance as it has been sent at a time when the Union Budget is under preparation.
CAIT National President BC Bhartia and Secretary General Praveen Khandelwal said that it is only at the initiative of CAIT and with the holistic approach of Prime Minister Narendra Modi, the Department for Industry was added with Internal Trade and now the National Retail Policy is under draft stage in the Ministry of Commerce.
However, there is an urgent need for immediate roll out of not only the National Retail Policy but an e-commerce policy which is also under draft stage and formation of an empowered Regulatory Authority for e-commerce.
In its communication to Sitharaman, Bhartia and Khandelwal, while demanding support for financial policies for the traders in the budget, said that the business community of India is facing huge crunch of financial liquidity and in the last many decades, the Reserve Bank of India (RBI) has failed to provide easy access to finances for the traders of the country, which in turn is causing under-utilisation of capacities and capabilities of the business community of the turning into a total loss situation to the national economy.
The RBI has always put its prime focus on the corporate sector only. It does not deem fit to consult the trade association ever to understand their financial needs though the non-corporate sector excluding agriculture is contributing magnificently to national exchequer and after agriculture, it is the the largest employment provider in the country. Yet the retail trade could not find any place in financial policies.
Bhartia and Khandelwal said that even after 75 years of independence, only 5 to 6 per cent of the small businesses in the country are able to meet their financial requirements from banks and other financial institutions whereas more than 90 per cent small businesses are dependent upon private money lenders, relatives and friends and various other informal sources.
Both the trade leaders suggested that besides advising the RBI to ensure smooth and easy access of finance to the trading community, the Finance Minister can spell out a policy in the budget to lay special emphasis on Non-Banking Finance Companies (NBFC) and Micro Finance Institutions (MFI) for lending to small businesses and that the banks and financial institutions should strengthen NBFCs and MFIs by providing requisite finance at a lower rate of interest so that both these lending institutions should provide finance to small businesses at a lower interest rate.