AHMEDABAD: Small and medium enterprises (SMEs) have pressed their demand that the committee of creditors (CoC) for Essar Steel revise the distribution pattern to ensure full payment to them.
A group of SMEs, operational creditors of Essar Steel, have written to the Centre that if the payment of Rs 980 crore is not done, it could lead to closure of many units and massive job losses.
The SME operational creditors, who have formed an organization called Operational Creditors Association (Essar Steel), have also threatened to stop supplyif their demands are not met.
“Some 1,500 SMEs will be affected if CoC does not revise its decision. There will be job losses,” said Kanaiyalal Agrawal, a member.
He said Rs 1,000 crore lent by Indian banks are likely to become NPA as SMEs will not be able to repay their loans. “CoC has done injustice to us and kept only 2.5% of the amount in the Resolution Plan,” a press release stated. The association suggested that profit earned during resolution process be shared with operational creditors who have kept up supply. The association claimed that all the CoC decisions were taken by only financial creditors.
“Not even a single member from operational creditors was given a place on the committee. So, our viewpoint for distribution is not taken into consideration anywhere,” the release said. Last month, the apex court paved the way for
ArcelorMittal
to take over Essar Steel.