The third meeting of the Working Committee on Finance formed by the National SME Development Task Force met here at the Small and Medium Enterprise Development Authority (Smeda) head office, to finalise the proposals for SME financing through formal sources in the country.
According to a Smeda spokesman, the meeting was presided over by Chairman Pakistan Banks Association, Shaukat Tareen. President Union Bank, Sultan Tiwana, General Manager Business Development Services, Nabeel Goheer and others attended the meeting.
Shaukat Tareen expressed the fullest satisfaction over performance of the sub-committees of this committee and hoped that the it would be able to submit final draft of the proposal for SME financing with the National Task Force on SME Policy by end of next month.
Earlier, the sub-committees made presentations on Situational Analysis, International Best Practices, Regulatory Framework and the Definition of an SME.
The presentations revealed that SMEs in Pakistan exist in a difficult situation. They have to face risks from management, marketing, finance and policy sides. To curtail such risks, the countries, exercising the best SME financing practices, have mostly framed out a separate legislation with an exclusive source of financing for SMEs.
For instance, China has introduced a special branch in its budget to provide funds for SME development. Similarly, Japan has established a Credit Guarantee Corporation to be funded by the government of Japan with 52 offices in all prefectures.
Sajjad Moghal, Manager Policy Planning and Advocacy Department Smeda, in his presentation, proposed a new regulatory framework for the SMEs in Pakistan in order to create an SME friendly policy environment.
He pointed out that besides making separate taxation rules for SMEs, the government should enforce long-term industrial and investment policies in the country.