New Delhi, Oct. 9 -- Chief Economic Adviser (CEA) V Anantha Nageswaran on Friday called for a review of the Reserve Bank of India's (RBI) loan overdue and Special Mention Account (SMA) classification norms for micro, small and medium enterprises (MSMEs), saying the existing framework does not adequately reflect differences in businesses' cash flow cycles and working capital needs.

"The moment you are classified as SMA, then you almost end up becoming already de facto, if not de jure," the CEA said.

Speaking at the 21st National Conference of Inclusive Growth organised by Sa-Dhan, Nageswaran highlighted that the Finance Ministry has been advocating a review of the norms to align them with India's business practices rather than follow a u...